Campbell Law Review
Volume 32
Issue 1 North Carolina 2009
Article 1
January 2009
Toward a Comprehensive Program for Regulating
Vacant or Abandoned Dwellings in North
Carolina: The General Police Power, Minimum
Housing Standards, and Vacant Property
Registration
C. Tyler Mulligan
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C. Tyler Mulligan, Toward a Comprehensive Program for Regulating Vacant or Abandoned Dwellings in North Carolina: The General Police
Power, Minimum Housing Standards, and Vacant Property Registration, 32 Campbell L. Rev. 1 (2009).
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Mulligan: Toward a Comprehensive Program for Regulating Vacant or Abandoned
Campbell Law Review
Volume 32
North Carolina 2009
Number 1
Toward a Comprehensive Program for Regulating
Vacant or Abandoned Dwellings in North
Carolina: The General Police Power,
Minimum Housing Standards, and
Vacant Property Registration
C.
TYLER MULLIGAN*
INTRODUCTION
It could happen on any street. A single home quietly becomes
vacant or abandoned. The reason for the vacancy or abandonment
could be one of any number of unfortunate circumstances: a lost job; a
debilitating illness in the family; mismanagement of household
finances; the death of a spouse or bread-winner; or perhaps an unanticipated reset of mortgage interest rates that raises the monthly payment
to levels just out of reach.
In ordinary times, many of these homes would be refinanced or
even sold by the owners, and the proceeds used to pay off the existing
debt. As a result of the recent economic crisis, however, home prices
dropped precipitously across the nation, leaving millions of homeowners with mortgage debt exceeding the current market value of their
homes. North Carolina has been hit, too. Of 1.4 million North Carolina mortgages examined at the end of the second quarter of 2009,
twenty-three percent were "underwater."' For these "underwater"
* Assistant Professor of Public Law and Government, School of Government,
University of North Carolina at Chapel Hill; B.A. 1993 Duke University; J.D. 1999 Yale
Law School. I am indebted to Jennifer Ma, who devoted many hours to research for
this Article as part of her clerkship with the School of Government in 2008, and to my
colleagues at the School of Government, particularly Fleming Bell, Frayda Bluestein,
Rich Ducker, David Lawrence, and David Owens, for their review and thoughtful comments on an earlier draft.
1. See FIRST AMERICAN CoRELOGIC, SUMMARY OF SECOND QUARTER 2009 NEGATIVE
EQUITY DATA (2009), http://www.loanperformance.com/infocenter/library/facl%20
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homeowners, refinancing or selling the home is not an option. No
bank will refinance a home with less value than the debt to be refinanced. Similarly, selling the home in a down market is not a viable
option because the proceeds will likely be insufficient to pay off the
mortgage debt.
Faced with this situation, some owners resort to abandoning their
homes, which leads mortgage lien holders to foreclose and add those
homes to an already heavy load of bank-owned properties. Other owners attempt to stay in their homes, perhaps hoping to take advantage of
recently enacted programs that delay rate resets or allow renegotiation
of loan terms. But only a portion will actually avoid foreclosure. 2
When owners lose significant household income, no adjustment to
loan terms can make the loan work. Regardless of an owner's choice,
the end result is often a vacant, unattended home.
The effects of a vacant or abandoned home go well beyond the
distress felt by the immediate homeowners. Vacant or abandoned
dwellings reduce the property values of neighboring homes, 3 foster
negative%20equity-final_081309.pdf (displaying data in "Table 1: Negative Equity by
State").
2. According to recent studies evaluating the effectiveness of loan modifications
and payment plans, these most recent foreclosure assistance efforts may help only half
of homes facing foreclosure. See OFFICE OF THE COMPTROLLER OF THE CURRENCY &
OFFICE OF THRIFT SUPERVISION, OCC AND OTS MORTGAGE METRICS REPORT: DISCLOSURE
(2008), http://www.
occ.treas.gov/ftp/release/2008-150a.pdf (tracking newly initiated home retention loan
modifications and payment plans, and finding for loans modified in the first quarter
of 2008, over thirty-five percent of borrows had re-defaulted after three months by
being more than thirty days past due; after six months, the re-default rate was over
fifty-five percent). As one commentator has asked:
The question is, why is the number of re-defaults so high? Is it because the
modifications did not reduce monthly payments enough to be truly affordable to the borrowers? Is it because consumers replaced lower mortgage payments with increased credit card debt? Is it because the mortgages were so
badly underwritten that the borrowers simply could not afford them, even
with reduced monthly payments? Or is it a combination of these and other
factors? We don't know the answers yet, but these are the types of questions
that we have begun asking our servicers in detail.
John C. Dugan, Remarks Before the OTS 3rd Annual National Housing Forum 3 (Dec.
8, 2008) (transcript available at http://www.occ.treas.gov/ftp/release/2008-142a.pdf).
3. Recent studies have focused on the effects of foreclosures on neighboring property values. See, e.g., CTR. FOR RESPONSIBLE LENDING, SOARING SPILLOVER: ACCELERATING
FORECLOSURES TO COST NEIGHBORS $502 BILLION IN 2009 ALONE (2009), http://www.
OF NATIONAL BANK AND FEDERAL THRIFT MORTGAGE LOAN DATA 5
responsiblelending.org/mortgage-lending/research-analysis/soaring-spillover-3-09.pdf.
For an overview of the price effects of foreclosure, see Kai-yan Lee, Foreclosure's PriceDepressing Spillover Effects on Local Properties:A Literature Review (Fed. Res. Bank of
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criminal activity,' and push neighborhoods into decline. 5 Local governments suffer because of decreased property tax revenues, even as
demand for government services, such as police patrols and code
enforcement,6 increases.7 Vacant and abandoned properties have been
recognized not only as symptoms of community distress, but also as a
cause and accelerant of neighborhood decline."
It is therefore not surprising that local governments have initiated
efforts to contain the damage to their communities and to their budgets resulting from an unprecedented number of vacant and abandoned
dwellings. Limited in their ability to change the foreclosure landscape,
local governments have resorted to what amounts to property manageBoston, Community Affairs Discussion Paper No. 2008-01, 2008), available at http://
www.bos.frb.org/commdev/pcadp/2008/pcadp08O .pdf.
4. See Dan Immergluck & Geoff Smith, The Impact of Single-Family Mortgage Foreclosures on Neighborhood Crime, HOUSING STUDIES, Nov. 2006, at 16, availableat http://
www.chicagofed.org/cedric/files/2005-conLpaper-sessionl-immergluck.pdf (finding
that each foreclosure in a 100-house neighborhood corresponded to a 2.33% jump in
violent crime, holding all other factors constant); see also Jonathan Mummolo & Bill
Brubaker, As Foreclosed Homes Empty, Crime Arrives, WASH. PosT (Apr. 27, 2008), at
Al, available at http://www.washingtonpost.com/wp-dyn/content/article/2008/04/
26/AR2008042601288.html (describing recent experiences of cities across the
country).
5. For a summary of the costs of vacant properties, see NAT'L VACANT PROPERTIES
CAMPAIGN, VACANT PROPERTIES: THE TRUE COSTS TO COMMUNITIES (2005), http://www.
vacantproperties.org/latestreports/true%20costs-augO5.pdf; see also Maya Brennan,
Stabilizing Communities Affected by Foreclosures: Lessons Learned from Vacant and Abandoned Properties Initiatives, FORECLOSURE RESPONSE, http://www.housingpolicy.org/
assets/foreclosure-response/stabilizingcommunities lessonsfromvacantproper ties.pdf;
John Accordino & Gary T. Johnson, Addressing the Vacant and Abandoned Property
Problem, 22 J. URB. AFF. 301, 303 (2000) ("Ample evidence exists to suggest that
[vacant and abandoned] properties also have social ramifications, as they tend to serve
as 'magnets for crime' and to increase the risks of fire and vandalism in urban neighborhoods." (citations omitted)).
6. See PatrikJonsson, Vacant Homes Spread Blight in Suburb and City Alike, CHRISTIAN SCI. MONITOR, July 1, 2008, http://www.csmonitor.com/2008/0702/p01s01usgn.html ("Boarded-up homes are an expensive problem for Atlanta, which has
already posted 'no trespass' signs at as many homes this year as in all of last year. ...
With 11 code enforcers laid off because of budget cuts, Atlanta police are working
overtime to patrol blighted streets. 'The responsibility is falling more heavily on our
shoulders,' says Atlanta Police Maj. Joseph Dallas.").
7. Brennan, supra note 5, at 5. Local governments have also lost property tax
revenue due to increased unsold housing inventory. See generally Dlv. OF CMTY. ASSISTANCE, N.C. DEP'T OF COMMERCE, SUBSTANTIAL AMENDMENT 2008 CONSOLIDATED ANNUAL
ACTION PLAN (2008), http://www.nccommerce.com/nr/rdonlyres/4d062e9e-c3a8-45
29-92bl-30472a3e82bf/0/actionplanupdated.pdf [hereinafter Neighborhood Stabilization Program Action Plan].
8. Accordino & Johnson, supra note 5, at 303.
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ment functions. These functions include: buying and holding abandoned properties (also known as "land banking"), facilitating the
redevelopment or reuse of abandoned properties, increasing police
activity in troubled areas, and executing aggressive code enforcement. 9
It is this last activity, code enforcement, which is the focus of this
Article.
Code enforcement, with regard to existing dwellings, can be
divided into two stages of activity. 10 The "early" stage involves preservation activity; for example, the enforcement of maintenance requirements in order to preserve a home. The "late" stage, occurring once a
dwelling is essentially beyond repair, relies on condemnation authority
for demolition. The majority of this Article is devoted to the "early"
stage of preservation activity.
In North Carolina, there are only two sources of statutory authority for the conduct of early stage code enforcement: (1) the general
police power local governments may exercise for the regulation and
abatement of "acts, omissions, or conditions, detrimental to the health,
safety, or welfare of its citizens and the peace and dignity of the [city or
county],"'" and (2) minimum housing standards. 1 2 After dissecting
and explaining this statutory authority, this Article will then explore
how a local government might harmonize the governing statutes into a
comprehensive policy regulating vacant and abandoned dwellings.
Part I of this Article provides a brief introduction to North Carolina's experience thus far with the foreclosure crisis and introduces the
broad array of statutorily granted tools local governments might
employ to deal with vacant or abandoned dwellings in varying stages
of neglect. Part II discusses the general police power that serves as the
first line of defense against the decline of vacant or abandoned housing, as well as how that power is limited by state statutes governing
minimum housing standards. Part III then turns to those minimum
housing statutes to examine their operation and limitations. Part IV
analyzes the authority of local governments in North Carolina to
implement a policy tool used in other states; namely, a vacant property
9. For a survey of practices employed by local governments nationwide, see
UNITED STATES CONFERENCE OF MAYORS, VACANT AND ABANDONED PROPERTIES:
SURVEY
(2009), available at http://usmayors.org/pressreleases/uploads/
vacantandabandprop09.pdf.
10. This Article addresses minimum standards for the preservation of existing
dwellings, not structures under construction. Accordingly, building codes are not
discussed.
11. N.C. GEN. STAT. §§ 160A-174(a), 153A-121(a) (2007).
12. Id. §§ 160A-441 to -450. Code enforcement is also available in the commercial
context, see, e.g., id. § 160A-439, but this Article's scope is limited to dwellings.
AND BEST PRACTICES
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registration program. Part V concludes by reflecting on the limitations
of North Carolina's complex web of code enforcement mechanisms
and proposes some ways in which the North Carolina General Assembly could enhance local governments' authority to regulate vacant and
abandoned dwellings.
I.
FORECLOSURES, VACANT DWELLINGS, AND
A CODE ENFORCEMENT APPROACH
Compared with other states, North Carolina has not suffered the
worst of the foreclosure crisis, but it has not escaped unscathed, either.
The North Carolina Commissioner of Banks reports that there were
46,375 foreclosure starts in North Carolina from January through the
end of September 2009-an increase of 11% (or 4,456 additional foreclosure starts) as compared to the same time period in 2008, which
itself was a record-setting year for foreclosures in the state.1 3 Overall,
North Carolina is expected to experience a 10-20% increase in foreclosure starts due to sub-prime mortgage rate resets and spillover from
the state's broader economic crisis. 14 In a bid to prevent home foreclosures, North Carolina enacted legislation to provide counseling and
temporary assistance to homeowners. 5 North Carolina has also
tinkered with the foreclosure process itself, regulating loan servicers
16
and requiring periods of delay during the foreclosure filing process.
Nonetheless, in a May 2009 report to the General Assembly, the Commissioner of Banks continued to call the foreclosure situation "serious"
and predicted increases in foreclosure activity due to rising levels of
unemployment in the state. 7
13. See Ctr. for Cmty. Capital, Univ. of N.C. at Chapel Hill, September 2009 Foreclosure Start Hotspots, http://ncforeclosurehelp.org/global/docs/aocreportinghot
spots.pdf (last visited Oct. 17, 2009) (tracking data reported by the Administrative
Office of the Courts for all 100 North Carolina counties).
14. Neighborhood Stabilization Program Action Plan, supra note 7, at 1.
15. See C. Tyler Mulligan, 2008 Legislative Action in Community and Economic Development, CMTY. & ECON. DEV. BULL., Oct. 2008, at 1-3, a-,ailable at http://www.nccda.
net/pdf/fall08/2008legislationaction.pdf.
16. Id. at 3-5.
17. Mark Pearce, Deputy Commissioner of Banks, Presentation to North Carolina
House of Representatives Financial Institutions Committee (Mar. 10, 2009), http://
www.ncforeclosurehelp.org/global/docs/nc%20house%20fi%20mortgage%20march
%202009.pdf. Severe job losses in North Carolina have contributed to the high rate of
foreclosures. North Carolina's unemployment rate has hovered around 11% since February 2009. See News Release, Employment Sec. Comm'n of N.C., State's Unemployment Rate Unchanged at 11 Percent in July (Aug. 21, 2009), available at http://www.
ncescl.com/pmi/rates/pressreleases/state/nrjuly09-strate.pdf. Moreover, 70% of
counties are currently in double-digit unemployment. See News Release, Employment
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Ongoing efforts to prevent foreclosures therefore remain important; however, it is equally important for state and local governments
to address the aftermath of foreclosure activity. Increasing attention is
now being given to the problem of maintaining or redeveloping empty
homes. On July 30, 2008, President Bush signed into law the Housing
and Economic Recovery Act of 2008, which devotes a title to "Emergency Assistance for the Redevelopment of Abandoned and Foreclosed
Homes."'1 8 On September 26, 2008, the Department of Housing and
Urban Development (HUD) announced procedures for the allocation
of $3.92 billion, pursuant to the Act, to be disbursed under a new
"Neighborhood Stabilization Program" designed to "provide targeted
emergency assistance to state and local governments to acquire and
redevelop foreclosed properties that might otherwise become sources
of abandonment and blight within their communities."' 19 North Carolina was allocated over $57 million in Neighborhood Stabilization Program grants, 20 and approximately $52 million of that amount was
distributed through a competitive grants program administered by the
North Carolina Department of Commerce's Division of Community
Assistance (DCA). 2 1 The enactment of the American Recovery and
federal funding to the
Reinvestment Act of 2009 provided additional
22
Program.
Stabilization
Neighborhood
While this federal funding is significant, North Carolina's share
will not cover all of its needs. The funding was intentionally funneled
Sec. Comm'n of N.C., July Unemployment Rates Decrease in Over Half of North Carolina's 100 Counties (Aug. 28, 2009), available at http://www.ncescl.com/pmi/rates/
pressreleases/county/nrjulyo9_countyrates.pdf. Nationally, job losses are thought to
be behind recent rises in the loan delinquency rate, which hit a record high in the first
quarter of 2009 and portends greater foreclosure activity. See News Release, American
Bankers Association, Consumer Delinquencies Continue Upward Climb in Second
Quarter 2009 (Oct. 1, 2009), availableat http://www.aba.com/press+room/100109d
bull2ndqtr.htm.
18. Housing and Economic Recovery Act of 2008, Pub. L. No. 110-289, 122 Stat.
2654 (2008).
19. News Release, U.S. Dep't of Housing & Urban Dev., Preston Allocates Nearly
$4 Billion to Stabilize Neighborhoods in States and Local Communities Hard-Hit by
Foreclosure (Sept. 26, 2008), http://www.hud.gov/news/release.cfm?content=pr08148.cfm.
20. U.S. Dep't of Housing & Urban Dev., Statewide Sum of Grants-Neighborhood
Stabilization Program, http://www.hud.gov/offices/cpd/communitydevelopment/
programs/neighborhoodspg/statewideallocations.xls (last visited Oct. 17, 2009) (providing figures in a downloadable spreadsheet document).
21. Neighborhood Stabilization Program Action Plan, supra note 7, at 1.
22. American Recovery and Reinvestment Act of 2009, Pub. L. No. 111-5, 123 Stat.
115 (2009).
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to a limited number of areas-those exhibiting the greatest need by
DCA's formula-meaning that only twenty-three of North Carolina's
100 counties were eligible to receive the first round of funds. 23 Moreover, even those counties receiving money will be required to direct the
limited resources to the most distressed neighborhoods, leaving other
areas unassisted by the program.2 4 Accordingly, when federal funding
falls short, local governments are left with two options: (1) to the
extent possible, use local government funds to purchase vacant dwellings outright or to offer grants to owners for repair and rehabilitation,25 and (2) implement a code enforcement plan requiring owners
to maintain or rehabilitate their dwellings at their own expense. 26
Regardless of whether a local government has sufficient revenue to
fund the first approach (increasingly unlikely under current economic
conditions), the code enforcement approach is a necessary component
of any comprehensive policy designed to address vacant and abandoned dwellings.
For local governments adopting a code enforcement approach,
several statutory tools are available. These options are best illustrated
through a simple thought experiment. Imagine a dwelling that
becomes vacant or abandoned. Assume that, at the moment it
27
becomes vacant or abandoned, this dwelling is in good condition.
Over time, the vacant and unattended dwelling slips into increasingly
worse states of disrepair. At each stage of deterioration, different types
of local government authority come into play.
At the point of initial vacancy or abandonment, the dwelling may
be in a reasonable state of repair. We will call this a "green condition"
vacant dwelling to indicate that it is sufficiently maintained such that
its outward appearance gives no indication that it is vacant, and the
structure presents no obvious hazards. As explained in the Introduction, any vacant property, regardless of condition, presents a real risk
to the community. 28 There is therefore a legitimate government interest in maintaining awareness of a green condition dwelling's state of
repair and in ensuring that the property remains well-maintained.
23. Neighborhood Stabilization Program Action Plan, supra note 7, at 4.
24. Id. at 4-5.
25. In North Carolina, at least one local government has sought authority from the
General Assembly to use eminent domain to acquire problem properties. See Act of
May 26, 2009, sec. 1, N.C. Sess. Laws 2009-34.
26. Part IV, infra, describes a comprehensive code enforcement plan.
27. This assumption does not always play out in reality. In the days and months
prior to abandonment, struggling owners are unlikely to have sufficient resources to
make repairs or conduct regular maintenance.
28. See supra text accompanying notes 3-8.
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However, no North Carolina statute provides specific authority to local
governments for monitoring such properties. Therefore, if a local government wishes to establish a monitoring program for green condition
vacant dwellings, it must devise its own regulations in reliance on its
general ordinance-making authority derived from the general police
power. 9
Suppose that our green condition dwelling described above is
neglected by its owners and falls into a state of minor disrepair. Minor
disrepair, for our purposes, means the dwelling is structurally sound
and still habitable; it is not yet "unfit for human habitation" (a defined
term, associated with minimum housing standards, that will be
explored in greater detail later).3 ° We will refer to this dwelling as
being in "yellow condition" to indicate that, although it exhibits visible
signs of neglect or deterioration, it is still fit for human habitation.
Thus, the visible signs of deterioration that signal that the house is
unattended are the focus of local government concern. The government's interests, with respect to a yellow condition dwelling, consist of
halting the decline of the dwelling, removing any visible signs of deterioration, inspecting the home for potentially hazardous conditions, and
restoring it to a green condition state of repair. As seen with green
condition dwellings, no statute addresses these local government functions with respect to a yellow condition dwelling; a local government
would therefore need to develop its own regulatory program in reliance
on its general ordinance-making authority. 3 '
If the decline of a yellow condition dwelling is not halted, the
dwelling may eventually become "unfit for human habitation" as
defined in the minimum housing statutes.3 2 A dwelling that is unfit
for human habitation is called a "red condition" dwelling for our purposes; a term indicating that the dwelling has deteriorated to the final
stage at which code enforcement tools have a reasonable likelihood of
preserving the structure. For dwellings in this condition, there is a preexisting statutory regime. In North Carolina, red condition dwellings,
29. N.C. GEN. STAT. §§ 160A-174(a), 153A-121(a) (2007).
30. See infra Part II.C and Part III. Under North Carolina's minimum housing statutes, dwellings are defined as "unfit for human habitation" when they suffer from
"defective conditions" such as "defects therein increasing the hazards of fire, accident,
or other calamities; lack of adequate ventilation, light, or sanitary facilities; dilapidation; disrepair; structural defects; uncleanliness" which render them "dangerous or
injurious to the health, safety or morals of the occupants of the dwelling, the occupants of neighboring dwellings, or other residents of the city." N.C. GEN. STAT.
§ 160A-444.
31. See supra note 29 and accompanying text.
32. See supra note 30.
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or those "unfit for human habitation," are subject to regulation by local
ordinances enacted pursuant to North Carolina's minimum housing
statutes.3 3
Table 1
Vacant Dwelling
Condition
Green
Statute(s)
Applicable when a
dwelling's condition is:
Comments
General police power to
regulate conditions detrimental to the health,
safety, or welfare of citizens and peace and dignity of the city or county
"detrimental to the health,
safety, or welfare of its citizens and the peace and
dignity of the city"
Although in good repair, vacant dwellings pose inherent
risks justifying some form of
reasonable regulation, primarily for monitoring and upkeep. (Part II,infra, discusses
the general police power in
detail.)
"detrimental to the health,
safety, or welfare of its citizens and the peace and
dignity of the city"
These dwellings, in addition to
being vacant, exhibit visible
signs of disrepair posing risks
that justify regulation to halt
the decline and restore such
_ dwellings to green condition.
"unfit for human habitation"
Local governments in North
Carolina may utilize procedures established under the
minimum housing statutes to
regulate these dwellings. (Part
III,infra, discusses minimum
_ housing statutes in detail.)
N.C. Gen. Stat. §§ 160A174(a), 153A-121(a)
General police power
(same as above)
Yellow
N.C. Gen. Stat. §§ 160A174(a), 153A-121(a)
I
Minimum housing standards
Red
N.C. Gen. Stat. § 160A441 through -450
Condemnation
N.C. Gen. Stat.
Black and Blue
(Condemnation)
§ 160A-425.1 et seq.
I
"especially dangerous to
life because of its liability
to fire or because of bad
conditions of the walls,
overloaded floors, defectve construction, decay,
,
This statutory authority permits
a local government to condemn property in this condition
and order its repair, closing, or
demolition, as appropriate.
unsafe wiring or heating
system, inadequate means
of egress"
Abatement of public
health nuisances
Black and Blue
(Imminent
danger)
_
"dangerous or prejudicial
ito the public health or public safety"
E.g., N.C. Gen. Stat.
§ 160A-193
__
Cities are authorized to "summadly remove, abate, or remedy" public health nuisances
and may summarily demolish
dwellings if they pose an "imminent danger." Monroe v.
City of New Bern, 580 S.E.2d
372, 374-75 (N.C. Ct. App.
12003).
Dwellings that deteriorate further, to the point that they become
candidates for demolition, are in "black and blue" condition. For
these, there is ample statutory authority for the initiation of condemnation proceedings, and in cases posing imminent danger, for summary
demolition.
It is helpful to see these stages of deterioration in context with the
full array of statutory grants of power. Table 1, above, summarizes the
33. See N.C.
GEN. STAT.
§§ 160A-441 to -450.
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preceding discussion and provides an overview of the statutory tools
available to local governments for regulating vacant dwellings.
This Article focuses only on regulations governing green, yellow,
and red condition vacant dwellings. It does not examine the regulation
of black and blue dwellings. This limited scope is based on four premises. First, as a practical matter, dwellings in black and blue condition
are unlikely to be repaired due to the high cost. They are, in fact, bet34
ter candidates for demolition than for rehabilitation. Second, and as
a corollary to the first point, code enforcement actions on vacant dwellings in green, yellow, and red condition are more likely to elicit the
desired response from a dwelling owner (i.e., repair and regular maintenance of the dwelling), because the cost of bringing such dwellings
into full compliance with some standard will be less than for black and
blue dwellings. Third, code enforcement action against black and blue
dwellings is arguably too late. The negative externalities that early
enforcement is designed to prevent-blighting influence, lower property values, and damage to neighborhood character-have likely
already occurred. Fourth, social theory explains that a house in
decline will actually deteriorate more quickly once it is in a visible
state of disrepair, so early intervention is necessary. According to the
"broken windows" sociological theory, highly contextual visible sym35
bols lead to epidemics of disorder if they are not addressed early on.
34. Redevelopment and reuse strategies are more appropriate for black and blue
properties, and those topics fall beyond the scope of this Article. Statutory authority
for redevelopment exists under North Carolina's redevelopment law. See N.C. GEN.
STAT. §§ 160A-500 to -526.
35. See James Q. Wilson & George L. Kelling, Broken Windows: The Police and
Neighborhood Safety, ATLANTIC MONTHLY, Mar. 1982, available at http://www.the
atlantic.com/doc/198203/broken-windows; see also GEORGE L. KELLING & CATHERINE
M. COLES, FIXING BROKEN WINDOWS: RESTORING ORDER AND REDUCING CRIME IN OUR
(1996). With respect to vacant or abandoned properties, the danger of a
neglected dwellings is that it could lead to more widespread blight. See
of
sprinkling
MALCOM GLADWELL, THE TIPPING POINT: How LITTLE THINGS CAN MAKE A BIG DIFFERCOMMUNITIES
141 (2000) ("If a window is broken and left unrepaired, people walking by will
conclude that no one cares and no one is in charge. Soon, more windows will be
broken, and the sense of anarchy will spread from the building to the street on which it
faces, sending a signal that anything goes."). For a recent critique of the broken windows theory, see PETER K.B. ST. JEAN, POCKETS OF CRIME: BROKEN WINDOWS, COLLECTIVE
ENCE
VIEW (2007). There is a rich body of research
theory. For a summary of some of the recent
windows
broken
the
exploring
to
devoted
research, see id. at 251-55 (describing seven quantitative studies and three qualitative
studies that were published between 1998 and 2003 about the broken windows theory
and concluding that seven of the studies support the broken windows theory, two of
the studies achieved "mixed results," and one of the studies did not support the broken
windows theory).
EFFICACY, AND THE CRIMINAL POINT OF
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In other words, if a few broken windows are not fixed, these visual
symbols of blight will signal to bad actors that a dwelling is vacant,
attracting (additional) vandalism and other criminal activity.
Expanding this theory to a neighborhood context, a few houses in visible disrepair may lead to the decline of surrounding dwellings. The
solution proposed by some is to fix the broken windows early on.36
Based on these premises, local governments may therefore prefer early
intervention and the immediate elimination of any visible signs of
deterioration. Indeed, North Carolina law explicitly permits governing
boards to make findings consistent with the broken windows theory.37
Focusing on green, yellow, and red condition dwellings, this Article will address how North Carolina local governments can best utilize
the authority identified above in Table 1 to conduct code enforcement
activities early and effectively to eliminate visible signs of deterioration
in vacant or abandoned dwellings.
II.
THE FIRST LINE OF DEFENSE: THE GENERAL POLICE POWER
As discussed above, the General Assembly has not enacted any
specific statutory scheme for the regulation of vacant dwellings in
green or yellow condition. Local governments seeking to regulate how
the appearance 38 of such dwellings is maintained must develop their
36. Early intervention is the solution suggested by the authors of the broken windows theory. See KELLING & COLES, supra note 35, at 251 ("From the earliest efforts to
eliminate graffiti in the New York City subway, every department was involved and
committed. Station managers monitored conditions in their stations continuously to
ensure that minimum standards were maintained. Maintenance and repair staff cleaned new graffiti promptly, secured token receptacles, and repaired and cleaned facilities ....
The end result was not only order restored, but crime reduced, and most
probably, prevented.... Taking our cue from the New York experience, we believe that
order-restoration and maintenance attempts are most effective and most likely to lead
to crime prevention and reduction when a community mounts an integrated and comprehensive effort.")
37. See N.C. GEN. STAT. §§ 160A-443(5a), (5b) (providing for the enactment of ordinances "if the governing body shall find.., that the continuation of the dwelling in its
vacated and closed status would . . . create a fire and safety hazard, would be a threat
to children and vagrants, would attract persons intent on criminal activities, would
cause or contribute to blight and the deterioration of property values in the area," etc.);
see also id. §§ 160A-425.1, -426 (authorizing an inspector to declare unsafe a vacant or
abandoned nonresidential building if it "appears to the inspector to be in such dilapidated condition as to cause or contribute to blight, disease, vagrancy, fire or safety
hazard, to be a danger to children, or to tend to attract persons intent on criminal
activities or other activities that would constitute a public nuisance").
38. References herein to "appearance," and later to "aesthetic" regulation, concern
the existing aesthetic features of dwellings-for example, keeping the outward appearance of the dwelling in good order, regardless of design or architectural style. These
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own regulatory programs in reliance on their general ordinance-making authority. 39 In order to fully explain this authority under the general police power, Section A provides a brief introduction to the larger
context in which local governments function and are granted powers
in North Carolina. Once the stage is set, Sections B and C will explore
the possibilities and limitations of the general police power with
respect to vacant and abandoned dwellings.
A.
Authority for the Exercise of the General Police Power by North
Carolina Local Governments
In a home-rule state, local governments are given broad authority-usually by the state constitution, sometimes by statutes, or bothto act on nearly all matters of local concern. This broad authority
exists unless a state statute preempts local action.4" Most states have
some form of home rule, with the exception of Virginia and North Carolina, which do not provide home-rule authority in their constitutions
or statutes.4 1 In North Carolina, local governments are creatures of
legislative benevolence-not constitutional mandate. 42 The North Carolina Constitution states: "The General Assembly ... may give such
powers and duties to counties, cities and towns, and other governmental subdivisions as it may deem advisable. '4 3 Accordingly, local governments in North Carolina do not enjoy home-rule and
must be
44
granted enabling authority from the state in order to act.
For actions under the general police power, North Carolina local
governments rely upon a broad legislative grant of ordinance-making
authority:
terms are not meant to refer to zoning-based appearance and aesthetic regulations
such as architectural style, required design features, and other non-maintenance
requirements such as buffer zones, landscaping, or open space. This point is discussed further in the discussion of "good repair" regulations in Part 1I.B, infra.
39. See N.C. GEN. STAT. § 160A-174 (for cities); id. § 153A-121 (for counties).
40. See Frayda S. Bluestein, Do North CarolinaLocal Governments Need Home Rule?,
84 N.C. L. REV. 1983, 1989-90 (2006).
41. Id. at 1990.
42. A. Fleming Bell, Article 4: The Police Power, in COUNTY AND MUNICIPAL GOVERNMENT IN NORTH CAROLINA 2 (UNC-Chapel Hill Sch. of Gov't 2007), available at http://
www.sog.unc.edu/pubs/cmg/cmg04.pdf ("North Carolina is not a 'home rule' state, as
that term is commonly understood. Its local governments exist by legislative benevolence, not by constitutional mandate.").
43. N.C. CONST. art. VII, § 1.
44. For an evaluation of North Carolina local government authority as compared to
home rule states, see Bluestein, supra note 40.
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[Cities and counties] may by ordinance define, prohibit, regulate, or
abate acts, omissions, or conditions, detrimental to the health, safety,
or welfare of its citizens and the peace and dignity of the [city or
county], and may define and abate nuisances.4 5
At first blush, this broad language appears to resolve most questions of
authority for local governments. Unfortunately, this broad authority is
also fraught with ambiguity-a problem further complicated in a nonhome-rule state like North Carolina. How much authority did the legislature actually intend to grant to local governments? What does it
mean to be detrimental to the "health, safety, or welfare" and the
"peace and dignity" of a city or county?
The extent of a local government's power under such broadlyworded grants of authority depends on statutory interpretation, as
applied by the courts. Under a broad interpretation, the statute might
be construed to grant local governments the authority to act on any
issue tangentially related to local health, safety, welfare, peace, or dignity. Under a strict or narrow interpretation, the statute might be read
to limit local government authority to essential acts-not simply convenient, but indispensable-to local health, safety, welfare, peace, or dignity. In North Carolina, a strict canon of interpretation known as
Dillon's Rule was regularly applied by the courts until the 1970s.4 6
However, in 1971 and 1973, the North Carolina legislature enacted a
call for broad interpretation. For counties, section 153A-4 of the General Statutes states:
It is the policy of the General Assembly that the counties of this State
should have adequate authority to exercise the powers, functions, privileges, and immunities conferred upon them by law. To this end, the
provisions of this Chapter and of local acts shall be broadly construed
and grants of power shall be construed to include any powers that are
reasonably expedient to the exercise of the power.47
Similar statutory language applies to cities.4 8 However, despite this
legislative directive, courts today still occasionally apply a Dillon's
49
Rule form of strict construction.
45. See N.C. GEN. STAT. § 160A-174(a) (2007) (for cities); id. § 153A-121(a) (for
counties).
46. See Bluestein, supra note 40, at 2011. Under Dillon's Rule, local governments
may only exercise three types of powers: (1) those granted to it by the legislature in
express words, (2) those "necessarily or fairly implied in, or incident to the powers
expressly granted," and (3) those "essential to the declared objects and purposes of the
corporation-not simply convenient, but indispensable." Id.
47. N.C. GEN. STAT. § 153A-4.
48. See id. § 160A-4.
49. See Bluestein, supra note 40, at 2012 ("North Carolina courts have not
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With this in mind, we return to the general police power. Will
this power be construed broadly or narrowly with respect to local government code enforcement programs to eliminate visible signs of deterioration? Case law suggests that local governments would receive the
benefit of broad construction. Even in the pre-1970s era of Dillon's
Rule, the general ordinance-making power of a city to "prevent nuisances"-even in the absence of specific state legislation-extended to
regulation of the location of hog pens,5 ° hospitals, 5 1 and gas stations. 52 Following the legislative call for broad interpretation of local
government authority, North Carolina case law evolved to grant even
broader authority under the police power.
The current test for examining the constitutional boundaries of
police power regulation of private property was established by the
North Carolina Supreme Court in A-S-P Associates v. City of Raleigh.53
In this case, the court employed an ends-means reasonableness test to
evaluate a comprehensive local ordinance governing aesthetic conditions in an historic district. In its analysis, the court explained that a
regulatory activity must first be within the scope of the general police
power.54 Once that is established, then the regulation must meet a
two-pronged test, which asks: "(1) Is the statute in its application reasonably necessary to promote the accomplishment of a public good
and (2) is the interference with the owner's right to use his property as
he deems appropriate reasonable in degree? ' 55 The court answered
these questions in the affirmative for the ordinance in question, but in
doing so, it distinguished aesthetic regulation of historic property
from other aesthetic regulation. 56 The court specifically declined to
consistently heeded this legislative directive to construe broadly local-enabling legislation. Instead, courts have intermittently applied Dillon's rule and other limiting rules
of construction.").
50. State v. Hord, 29 S.E. 952 (N.C. 1898).
51. Lawrence v. Nissen, 91 S.E. 1036 (N.C. 1917).
52. Gulf Refining Co. v. McKernan, 102 S.E. 505 (N.C. 1920) (upholding a Sanford
ordinance prohibiting aboveground storage of kerosene or gasoline within 1000 feet of
any dwelling).
53. 258 S.E.2d 444, 448-49 (N.C. 1979) ("Several principles must be borne in
mind when considering a due process challenge to governmental regulation of private
property on grounds that it is an invalid exercise of the police power. First, is the
object of the legislation within the scope of the police power? Second, considering all
the surrounding circumstances and particular facts of the case is the means by which
the governmental entity has chosen to regulate reasonable?" (citations omitted)).
54. Id. at 448.
55. Id. at 449.
56. Id. at 450.
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expand the scope of the police power to permit regulation for aesthetic
purposes alone.5 7
The court's position changed in 1982 when, in State v. Jones, it
determined that regulation of private property based on aesthetic considerations alone was a valid exercise of the police power. 58 This decision was consistent with the general trend across the nation of judicial
deference toward municipal police power during the second half of the
twentieth century.5 9 In deciding Jones, which concerned fencing
around a junkyard, the court took the opportunity to explore the permissibility of aesthetic regulations generally, stating:
Aesthetic regulation may provide corollary benefits to the general community such as protection of property values, promotion of tourism,
indirect protection of health and safety, preservation of the character
and integrity of the community, and promotion of the comfort, happiness, and emotional stability of area residents .... We therefore hold
that reasonable regulation based on aesthetic considerations may constitute a valid basis for the exercise of the60police power depending on
the facts and circumstances of each case.
The Jones court adopted the ends-means reasonableness test
found in A-S-P Associates, but it elaborated on it, describing a separate
balancing test to be applied to aesthetic regulations; namely that "the
diminution in value of an individual's property should be balanced
57. Id. (taking note of "the growing body of authority in other jurisdictions recognizing that the police power may be broad enough to include reasonable regulation of
property for aesthetic reasons alone" but not endorsing "such a broad concept of the
scope of the police power").
58. State v. Jones, 290 S.E.2d 675, 681-82 (N.C. 1982) (holding that a local government's ordinance requiring fencing around a junkyard for aesthetic reasons was a
valid exercise of the police power).
59. See JOHN P. DWYER & PETER S. MENELL, PROPERTY LAW AND POLICY: A COMPARATIVE INSTITUTIONAL PERSPECTIVE 919 (1998). Dwyer and Menell explain the development of this trend as follows:
After [Village of Euclid v. Ambler Realty Co., 272 U.S. 365 (1926)] held that
municipalities could, consistent with due process, invoke the police power to
regulate private land use, the balance of power between the community's
right to shape land use and individual property and civil rights shifted dramatically in favor of municipal authority. Highly deferential judicial review
as well as the underlying logic of Euclid quickly led municipalities not only to
regulate uses that directly affected health and welfare, but also to regulate or
even prohibit uses that reflect individual aesthetic judgment ....
Id. Prior to Euclid, most state courts had held that the police power did not extend to
aesthetic regulation. See id.
60. Jones, 290 S.E.2d at 681.
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against the corresponding gain to the public from such regulation. '61
The court explained, "[t]he test focuses on the reasonableness of the
regulation by determining whether the aesthetic purpose to which the
regulation is reasonably related outweighs the burdens imposed on the private property owner by the regulation."6 2 In weighing the burdens on
the private-property owner, factors to consider include whether the
most substantial part of the value of the individual's property is confiscated, or whether the individual is deprived of reasonable use of the
property.6 3 On the public benefit side of the equation, factors include
the purpose of the regulation, the manner in achieving the permitted
purpose, 64 and the aforementioned corollary benefits to the general
community such as "protection of property values," "preservation of
the character and integrity of the community," and "promotion of the
comfort, happiness, and emotional stability of area residents. '6 5 For
the junkyard fencing regulations in Jones, the court found that the balancing test weighed in the local government's favor.66
But with respect to vacant dwelling regulations, which test would
a court apply? Would a court apply the stricter State v. Jones balancing
test or the A-S-P Associates reasonableness test? An analysis of the purpose of vacant dwelling regulations suggests North Carolina courts
would likely adopt the latter. As already pointed out, any vacant dwelling regulation designed to encourage owners to maintain the outward
appearance of dwellings-including maintenance of existing components or features that serve aesthetic purposes, such as an existing
exterior light fixture-is not made in service of aesthetic purposes
alone. Recall that there are many other reasons for establishing vacant
dwelling regulations, ranging from crime deterrence and reduction of
fire and flooding hazards, to combating blight and preserving prop61. Id. This language first appears without elaboration in A-S-P Associates v. City of
Raleigh, almost as an aside. 258 S.E.2d 444, 451 (N.C. 1979).
62. Jones, 290 S.E.2d at 681 (emphasis added). Although the test articulated in
Jones can be viewed as an elaboration of the original A-S-P Associates test, the italicized
language and the accompanying factors are frequently treated as an independent test
for aesthetic regulations. See, e.g., Summey Outdoor Adver., Inc. v. County of Henderson, 386 S.E.2d 439, 444 (N.C. Ct. App. 1989); Capital Outdoor, Inc. v. Tolson, 582
S.E.2d 717, 722 (N.C. Ct. App. 2003); Quality Built Homes, Inc. v. Village of Pinehurst, No. 1:06CV1028 2008 WL 3503149, at *8 (M.D.N.C. Aug. 11, 2008). TheJones
balancing test will therefore be distinguished from the A-S-P reasonableness test for
purposes of this Article.
63. Jones, 290 S.E.2d at 681.
64. Id.
65. Id.
66. Id. at 681-82 (holding that the "ordinance in instant case" is a valid exercise of
the police power).
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erty values. 6 7 When purposes other than purely aesthetic rationale
exist, courts have declined to apply the stricter State v. Jones balancing
test, and have instead applied the A-S-P Associates reasonableness
test.68 One appellate panel relied simply on a local ordinance's find-
ings and purpose clause to convince itself that an ordinance served
more than purely aesthetic concerns.6 9 Where this has occurred,
courts have then turned to the A-S-P Associates test and had little difficulty finding an ordinance to be reasonably related to a legitimate public purpose.7 °
Although we cannot know for certain in the absence of case law
on point, there is little reason to think the result would be different for
a vacant dwelling regulation. Nonetheless, out of an abundance of caution, it is helpful to examine vacant dwelling regulations under the
stricter State v. Jones balancing test to convince us of the viability of
such regulations. As demonstrated in the next Section, vacant dwelling regulations will likely hold up even under the more difficult test.
B.
The Police Power as Applied to Regulation of Vacant and
Abandoned Dwellings
A comprehensive vacant dwelling regulatory program would likely
regulate two different aspects of a vacant dwelling: one aspect being
existing components contributing to structural soundness or safety,
and the other being existing components and features that serve primarily aesthetic purposes. 7 1 We will refer to regulations governing the
67. See supra Introduction and Part I.
68. See, e.g., Summey Outdoor, 386 S.E.2d at 444-45 (finding Jones to be "inapplicable to the case at bar, because the ordinance in question [was] not for aesthetics
only," and proceeding with an analysis under A-S-P Associates); see also Capital Outdoor, 582 S.E.2d at 722 (declining to apply the State v. Jones balancing test to billboard
height regulations because they addressed safety concerns as well as an aesthetic purpose). In the cases just cited, the courts had little difficulty finding the ordinances
under review were within the scope of the police power.
69. See Summey Outdoor, 386 S.E.2d at 444 ("Furthermore, we rely on Article 11 of
the ordinance where aesthetics is listed as only one of several purposes.").
70. See, e.g., id. at 444; Capital Outdoor, 582 S.E.2d at 722.
71. A further distinction exists here between two different types of aesthetic regulations: (1) "good repair" of existing dwelling components and features that serve only
an aesthetic purpose such as an existing fence, existing light fixture, or existing accessory building; and (2) aesthetic architectural or landscaping regulations requiring new
construction or repair to comply with a certain aesthetic standard, such as paint color,
number of trees, or aesthetic design requirements. This Article's focus on existing
dwellings means that we are concerned only with the former, which we term "good
repair" regulations. For an exploration of architectural and landscaping regulations
which is beyond the scope of this Article, see Quality Built Homes, Inc. v. Village of
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latter type as "good-repair" regulations. For example, a good-repair
regulation, aiming to eliminate visible signs of deterioration, might
require an owner to repair an existing decorative fence with missing
planks, or to replace a damaged exterior ornamental light fixture, even
if such adorning items are not unsafe and serve only aesthetic purposes.7 2 As already mentioned, such regulations should be evaluated
under the A-S-P Associates ends-means reasonableness test because
they serve more than just an aesthetic purpose.7 3 But what if a court
attempts-perhaps incorrectly-to apply the State v. Jones balancing
test to a good-repair regulation or to some portion of it?
A good-repair regulation, such as a requirement that exterior ornamental light fixtures be kept in good repair, would likely survive court
scrutiny even if evaluated under the State v. Jones test. Applying the
first prong of the test, the court would examine the "gain to the public"
from the good-repair regulation. Recall that "public benefits" may
include such items as "protection of property values," "preservation of
the character and integrity of the community," and "promotion of the
comfort, happiness, and emotional stability of area residents."7 4 In the
case of a good-repair regulation, the elimination of visible indications
of disrepair or neglect certainly preserves the character of the community (assuming that other, occupied dwellings are in a good state of
repair) and promotes the comfort, happiness, and emotional stability
of area residents by eliminating unsightly disrepair. But the regulation
also generates other important benefits such as (1) eliminating a visible signal of neglect that could attract criminal activity, (2) creating
repair activity at a dwelling that otherwise would go unmonitored, and
(3) breaking a causal link in the spread of blighting conditions to other
Pinehurst, No. 1:06CV1028, 2008 WL 3503149, at *8-9 (M.D.N.C. Aug. 11, 2008)
(unpublished) (undertaking a Jones analysis and upholding an ordinance containing
architectural and landscaping requirements following a determination that the municipality presented sufficient evidence of "corollary benefits" and that the cost of compliance was not "so prohibitive that the burden to them outweighs the benefits to the
community").
72. Other examples of aesthetic conditions which might be controlled by a vacant
dwelling regulation include: removal of graffiti; maintenance of accessory buildings in
a state of good repair; maintenance of driveways and sidewalks in good repair; repair
of peeling or chipping paint; removal of non-combustible rubbish from the premises;
landscaping to a neighborhood standard; and repair of cracked (but intact) window
panes, to name only a few possibilities. These items, while arguably aesthetic in
nature, would be regulated for the purpose of avoiding the negative externalities produced by a vacant dwelling in a visible state of disrepair, such as criminal activity.
73. See supra notes 67-69 and accompanying text.
74. See State v. Jones, 290 S.E.2d 675, 681 (N.C. 1982).
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properties, as described by the broken windows theory.75 Addition-
ally, property values will be preserved to some degree by requiring
existing aesthetic components of vacant dwellings to be maintained in
good repair, though it is difficult to determine exactly how much value
can be attributed to the good repair of a dwelling as compared to the
price effects caused by its vacant state (and other related factors such
as mortgage and property tax delinquency). Nonetheless, with all
these factors taken together, the gain to the public from good-repair
regulations is substantial.
The other prong of the balancing test measures the "diminution in
value of an individual's property" or the "burdens imposed on the private property owner" due to the good repair regulation.76 Using our
exterior light fixture example, it would be difficult to argue that the
regulation causes a "diminution in value" of the regulated property.
After all, the value of a dwelling is normally sustained, if not increased,
when it is well-maintained. By eliminating or reducing visible signs of
neglect, the regulation also deters criminal activity, arson, and theft by
disguising the property's vacant state. The whole point of a vacant
dwelling regulation is to avoid waste and maintain the value of the
vacant dwelling along with that of neighboring properties.
A case might be made, however, that a private owner with different priorities from the local government shoulders a "burden" of maintenance under a good-repair regulation that may outweigh the "gain to
the public." Such a private owner could argue that the effort and
immediate cash outlay for the maintenance of a dwelling creates a
harm or burden that exceeds any loss in property value resulting from
neglect. But the courts are unlikely to sympathize with the owner. In
deciding due process or takings challenges to municipal land-use regulations, North Carolina courts are reluctant to find an ordinance
unconstitutional even when the cost of compliance is "prohibitive" for
the owner, or when compliance causes "hardship and inconvenience"
for a particular owner. 77
75. See supra note 35 and accompanying discussion.
76. Jones, 290 S.E.2d at 681.
77. See Responsible Citizens in Opposition to Flood Plain Ordinance v. City of
Asheville, 302 S.E.2d 204, 210 (N.C. 1983) ("Even assuming that the cost of complying with the land-use regulations is prohibitive (and we do not decide that it is) and
recognizing that the market value of plaintiffs' properties has diminished (a fact found
by the trial court), these factors are of no consequence here. As this Court noted in AS-P Associates v. City of Raleigh, 'the mere fact that an ordinance results in the depreciation of the value of an individual's property or restricts to a certain degree the right to
develop it as he deems appropriate is not sufficient reason to render the ordinance
invalid."' (citations omitted)); Appeal of Parker, 197 S.E. 706, 710 (N.C. 1938) ("The
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A comparison to the facts in State v. Jones provides further support for this position. An owner of a vacant dwelling may protest any
requirement to expend funds to maintain the dwelling, just as the
junkyard owner in Jones resisted the requirement to expend funds for
the erection of a fence. The key finding in that case for purposes here,
however, was that the gain to the public from the aesthetic improvement alone, outweighed this private burden borne by the junkyard
owner.7 8 Compare these facts to the case of good-repair regulations
for vacant and abandoned dwellings. The case for finding that public
gain outweighs the private burden in the case of a good repair-regulation is actually more compelling than it was for the junkyard in Jones.
After all, the private owner of a dwelling actually shares in the public
gain since the owner's dwelling will likely have higher value if maintained rather than neglected. The junkyard owner, on the other hand,
bore the expense of erecting a privacy fence for aesthetic purposes, but
likely gained little or no property value through that action (as junkyards are not typically valued on appearance nor on the presence of
petitioner complains that the ordinance is an arbitrary and unreasonable restriction
upon the petitioner's property rights. That he, due to the particular circumstances of
his case, may suffer hardship and inconvenience by an enforcement of the ordinance is
not sufficient ground for invalidating it. The fact that the ordinance is harsh and seriously depreciates the value of complainant's property is not enough to establish its
invalidity." (citations omitted)); see also Summey Outdoor Adver., Inc. v. County of
Henderson, 386 S.E.2d 439, 445 (N.C. Ct. App. 1989) ("The fact that it will be costly
for plaintiff to bring some of his signs into compliance with the ordinance does not
rise to the level of an interference with his right to use the property as he deems fit.").
These North Carolina Supreme Court decisions rest securely within the bounds of
United States Supreme Court jurisprudence. See Penn Cent. Transp. Co. v. New York
City, 438 U.S. 104, 138 (1978) (holding that New York City's restrictions on the development of historic landmarks like Grand Central Terminal were constitutionally permissible and were not a "taking" because "[t]he restrictions imposed are substantially
related to the promotion of the general welfare" and still permitted reasonable beneficial use of the property). In its analysis, the Supreme Court showed deference to legislative determinations of public interest, overriding individual real property interests:
"[Iln instances in which a state tribunal reasonably concluded that 'the health, safety,
morals, or general welfare' would be promoted by prohibiting particular contemplated
uses of land, this Court has upheld land-use regulations that destroyed or adversely
affected recognized real property interests." Id. at 125 (citing Nectow v. City of Cambridge, 277 U.S. 183, 188 (1928)). The Court specifically noted: "States and cities
may enact land-use restrictions or controls to enhance the quality of life by preserving
the character and desirable aesthetic features of a city." Id. at 129 (citing New Orleans
v. Dukes, 427 U.S. 297 (1976); Young v. American Mini Theatres, Inc., 427 U.S. 50
(1976); Village of Belle Terre v. Boraas, 416 U.S. 1, 9-10 (1974); Berman v. Parker,
348 U.S. 26, 33 (1954)).
78. Jones, 290 S.E.2d at 681-82.
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aesthetic fences). Rather, the benefit accrued almost entirely to the
surrounding property owners and the public at large, yet the court
upheld the aesthetic regulation. 79 It seems likely, therefore, that goodrepair regulations of abandoned or vacant dwellings would actually
fare better under the court's balancing test than regulations pertaining
to the appearance of junkyards.
Accordingly, even the stricter State v. Jones balancing test will not
be an obstacle to the enactment of local regulations governing conditions-whether aesthetic or otherwise-found in vacant or abandoned
dwellings. It thus appears safe to conclude that North Carolina local
governments may enact reasonable regulations governing the maintenance of vacant and abandoned dwellings under the general police
power, including regulations requiring that aesthetic features or components be maintained in good repair. In the case of green and yellow
condition dwellings, this ends our analysis. This is because there is no
other statutory authority upon which a local government may rely; in
the absence of any other statutory authority, local governments have
no choice but to employ their general ordinance-making authority
under the police power in order to regulate green and yellow condition
dwellings.8 0
The same cannot be said, however, for red condition dwellings. In
those cases, the General Assembly has already provided specific regulatory authority through the minimum housing statutes. The next sections explore how this existing minimum housing authority occupies
some preemptive space, thereby limiting the extent to which a local
government may utilize its general ordinance-making authority to
devise its own regulatory program for red condition dwellings.
C.
Limitations on the General Ordinance-MakingAuthority:
Bumping Up Against North Carolina'sMinimum Housing
Standards Statutes
Red condition dwellings are those that are "unfit for human
habitation," as defined by North Carolina's minimum housing statutes.8 1 There are two possible statutory authorities that may apply to
the regulation of red condition vacant dwellings. First, a local government's general police power, as discussed in the prior Section, is broad
enough to support the regulation of vacant dwellings in any condition.
Second, the minimum housing statutes provide a mechanism for the
79. Id.
80. See supra notes 29-31 and accompanying text.
81. See supra notes 30-33 and accompanying text.
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regulation of red condition dwellings specifically. This Section
describes the tension between those two alternatives, explains the
effect of statutory interpretation and state preemption law, and discusses the limits imposed by the minimum housing statutes on vacant
dwelling regulations pursuant to the general police power.
When a North Carolina local government is authorized to carry
out an activity by more than one statute, generally the local government may use any, or all of those statutes as the basis for its authority
to act.8 2 However, there are two instances in which a local government
may be required to act under the authority of only one statute or statutory scheme. The first instance is preemption, and the second results
from the application of the "specific trumps the general" canon of statutory interpretation. Preemption can occur when a local ordinance
attempts to "regulate a field for which a State or federal statute clearly
shows a legislative intent to provide a complete and integrated regulatory scheme to the exclusion of local regulation." 3 This preemption
doctrine is codified and applied to cities 4 and has also been applied to
county regulations.8 5 Even if state statutes do not create a "complete
and integrated regulatory scheme," some specific grants of authority
impose precise requirements on local governments that may trump a
more general power as a matter of statutory interpretation, particularly
where a regulation adopted under a general power is "repugnant" to a
more specific grant of authority.8 6
82. Bell, supra note 42, at 5 ("In many of those cases in which a city or county is
authorized to carry out a particular activity by more than one statute, the local government may use any of them as its authorization."). This approach is explicitly sanctioned for general laws and local acts in sections 153A-3 and 160A-4. Id.
83. N.C. GEN. STAT. § 160A-174(b)(5) (2007); see also In re Application of
Melkonian, 355 S.E.2d 503, 507-08 (N.C. Ct. App. 1987) ("'Municipal ordinances are
ordained for local purposes in the exercise of a delegated legislative function, and must
harmonize with the general laws of the State. In case of conflict the ordinance must
yield to the State law.' G.S. 160A-174 establishes, inter alia, that local ordinances are
preempted by North Carolina State law when local ordinances are not consistent with
State law; and that an ordinance is not consistent with State law when ...[t~he ordinance purports to regulate a field for which a State or federal statute clearly shows a
legislative intent to provide a complete and integrated regulatory scheme to the exclusion of local regulation." (quoting Davis v. City of Charlotte, 89 S.E.2d 406, 409 (N.C.
1955)).
84. N.C. GEN. STAT. § 160A-174(b).
85. See generally Sandy Mush Props., Inc. v. Rutherford County, 595 S.E.2d 233
(N.C. 2004).
86. See Krauss v. Wayne County Dep't of Soc. Servs., 493 S.E.2d 428, 433 (N.C.
1997) ("'Where there is one statute dealing with a subject in general and comprehensive terms, and another dealing with a part of the same subject in a more minute and
definite way, the two should be read together and harmonized ...; but, to the extent of
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Thus, even though the general police power authorizes broad local
government regulation of vacant and abandoned dwellings, as
described above in Section B of this Part, the existence of other more
specifically-drawn statutes may nevertheless exclude the use of procedures adopted under the police power authority. In the context of regulating vacant and abandoned dwellings, the minimum housing
statutes raise precisely this issue. Those statutes authorize local governments to enact ordinances regulating the repair or demolition of
dwellings that have become "unfit for human habitation."8 7 However,
the minimum housing statutes do not, importantly, regulate dwellings
that remain "fit" for human habitation-dwellings that were described
in Part 1, supra, as being in green and yellow condition. Therefore, our
analysis of the related issues of preemption and statutory interpretation raised by state minimum housing statutes pertains only to red
condition dwellings.
As a result, with respect to red condition dwellings, the question
becomes whether the North Carolina minimum housing statutes either
(1) constitute a "complete and integrated regulatory scheme" to the
exclusion of local regulation or (2) impose such precise requirements
that, as a matter of statutory interpretation, must be followed in any
regulations devised for vacant or abandoned dwellings.
As to the first question, there is nothing found in case law that
suggests that the minimum housing statutes preempt the field. North
Carolina appellate courts, when presented with an opportunity to do
so, have stopped short of defining minimum housing statutes as a
"complete and integrated regulatory scheme" designed to exclude all
any necessary repugnancy between them, the special statute ...will prevail over the
general statute."' (citing McIntyre v. McIntyre, 461 S.E.2d 745, 747 (N.C. 1995) (quoting Nat'l Food Stores v. N.C. Bd. of Alcoholic Control, 151 S.E.2d 582, 586 (N.C.
1966)))); see also Durham Land Owners Ass'n v. County of Durham, 630 S.E.2d 200,
203 (N.C. Ct. App. 2006) (reasoning that the general power under G.S. 153A-4
remains idle when a more specific statute is clear on its face); Bell, supra note 42, at 6
("[I]n some cases other articles of Chapters 153A and 160A provide such detailed or
different requirements for particular kinds of ordinances that it is clear that those
procedures must be followed when cities and counties take the actions covered by
those more specific statutes."). Examples of such specific grants of authority include
hearing requirements in planning and development regulations and procedures for
disposal of junked or abandoned motor vehicles. Id. ("[Wihile in theory local officials
can control the disposal of junked or abandoned motor vehicles through either the
general police power of G.S. 153A-121(a) and G.S. 160A-174(a) .... Since the legislature has provided specific rules in these statutes for junked or abandoned vehicle disposal, it is common practice for most officials to 'play it safe' and follow the
guidelines.").
87. N.C. GEN. STAT. § 160A-441.
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other regulation. 8 The answer to the second question, however, is
more nuanced.
Although courts have not gone so far as to suggest that the minimum housing statutes preempt local regulation, they have looked unfavorably upon local activities found to be inconsistent with the statutes'
precise procedural requirements. In Newton v. City of Winston-Salem,
the North Carolina Court of Appeals held that a local government was
required to follow the procedural requirements of the minimum housing statutes when regulating dwellings unfit for human habitation,
declaring that "[t]he statute specifically states that cities and counties
may exercise such powers only 'in the manner herein provided."' 8 9
The court, in making this finding, noted the statutory requirement that
"an ordinance adopted by a city to regulate buildings unfit for human
habitation 'shall contain' certain provisions" found in the minimum
housing statutes.9 ° These judicial declarations suggest that the procedural provisions found in the minimum housing statutes occupy some
preemptive space.
The Newton decision can be explained in accordance with
accepted principles of statutory construction. Specifically, the mini88. In cases dealing with the issue of whether local governments must follow the
specific procedures set forth in the minimum housing statutes, as opposed to locallygenerated procedures, courts have resolved the question by requiring local governments to follow the statutory procedures. Nonetheless, in doing so, the courts have
not taken the additional step of explicitly declaring that minimum housing statutes
"preempt the field." See Newton v. City of Winston-Salem, 374 S.E.2d 488, 490-91
(N.C. Ct. App. 1988); see also Town of Hertford v. Harris, 611 S.E.2d 194, 196-97
(N.C. Ct. App. 2005) ("Regardless of the specific wording of the town's ordinance, the
town must comply with the statute's requirement [in N.C. GEN. STAT. § 160A443(6)(c)] that any personal property or appurtenances be salvaged and the proceeds
applied to the cost of removal or demolition."); Dean v. City of Charlotte, No. COA04931, 2005 WL 465906, at *2-3 (N.C. Ct. App. Mar. 1, 2005) (unpublished opinion).
89. 374 S.E.2d at 490-91 (emphasis added). The word "only," emphasized in the
quoted text, appears in the opinion but does not appear in the cited minimum housing
statute. See id.
90. Id. at 491. See also Dean, 2005 WL 465906, at *2 ("The enabling legislation
provides that an ordinance adopted by a city to regulate buildings unfit for human
habitation must contain certain procedures that the city must follow prior to demolition of a dwelling including providing the owner with notice, a hearing, and a reasonable opportunity to bring his or her dwelling into conformity with the housing code.").
This result may not have been intended by the statute's drafters. Cf. N.C. GEN. STAT.
§ 160A-450 ("Nothing in this Part shall be construed to abrogate or impair the powers
of the courts or of any department of any city to enforce any provisions of its charter
or its ordinances or regulations, nor to prevent or punish violations thereof; and the
powers conferred by this Part shall be in addition and supplemental to the powers
conferred by any other law.").
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mum housing statutes provide detailed procedural protections for
property owners of unfit dwellings 9 ' that would be eviscerated if local
governments could simply act under the general police power. To permit a local government to evade those procedural protections would
either be "repugnant" to the minimum housing statutes,92 or would
violate the canon requiring statutes to be interpreted in a way that
avoids meaningless construction. 93 Therefore, to lend meaning to the
state's minimum housing statutes, local governments must utilize the
procedures set forth in those statutes when establishing regulations
governing the repair of red condition dwellings that are "unfit for
human habitation."
This does not, however, wholly resolve the question. How do the
two regulatory schemes apply to a red condition dwelling that simultaneously exhibits conditions rendering it unfit for human habitation
(like a gaping hole in the roof) and conditions that do not contribute to
its "unfit" state (such as damaged ornamental exterior light fixtures)?
Does the fact that the dwelling is classified in red condition and unfit
for human habitation require the application of the procedures set
forth in the minimum housing statutes to all repairs, however minor or
aesthetic? Or are the minimum housing statutes' procedures applied
only to repairs pertaining to a dwelling's fitness, or unfitness, for
human habitation? Examination of the statute suggests that it must be
the latter. The plain language of the minimum housing statutes permits local governments to issue orders to repair a dwelling "in order to
91. See Newton, 374 S.E.2d at 491-92 (holding that Winston-Salem was required to
follow the specific notice and service requirements for minimum housing ordinances
as set forth in section 160A-443, particularly since "[sItatutes authorizing service by
mail or publication are strictly construed and must be followed with particularity"
(citing Hassell v. Wilson, 272 S.E.2d 77, 82 (N.C. 1980)).
92. See supra note 86 and accompanying text.
93. See TRW Inc. v. Andrews, 534 U.S. 19, 31 (2001) ("It is a cardinal principle of
statutory construction that a statute ought, upon the whole, to be so construed that, if
it can be prevented, no clause, sentence, or word shall be superfluous, void, or insignificant .... We are reluctant to treat statutory terms as surplusage in any setting . ."
(internal quotations and citations omitted)); State v. Buckner, 527 S.E.2d 307, 311
(N.C. 2000) ("If possible, a statute must be interpreted so as to give meaning to all its
provisions."); see also Five C's, Inc. v. County of Pasquotank, 672 S.E.2d 737, 741
(N.C. Ct. App. 2009) (holding that the broad grant of police power authority in N.C.
GEN. STAT. § 153A-4 must remain idle to give meaning to the provisions of an existing
statute and stating that "[a] county may not therefore use its broad police powers as a
guise to enact zoning regulations for manufactured homes inconsistent with N.C. Gen.
Stat. § 160A-383.1").
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render it fit for human habitation."9' 4 Those statutes are silent, however, on how to address repairs that could not, by themselves, "render
[a dwelling] fit for human habitation," such as a good-repair regulation
of existing ornamental features. 95 Indeed, the minimum housing statutes appear not to contemplate good-repair regulations at all.
Therefore, it can be concluded that the reach of the minimum
housing statutes extends only to conditions that, if repaired, would
"render [a dwelling] fit for human habitation." Accordingly, the minimum housing statutes would not preempt good-repair regulations
applied to red condition dwellings. Returning to the specific example
used in the previous section, a good-repair regulation-created under
the general police power and requiring the repair of all damaged ornamental exterior light fixtures on vacant dwellings-could be implemented under procedures developed independently of the minimum
housing statutes, even if applied to a red condition dwelling. The
good-repair regulation would draw its authority from, and would need
to be consistent with, the general police power alone.
This important point is potentially confusing, but might be clarified with a simple illustration. The universe of regulations governing
the maintenance of vacant or abandoned dwellings, applied to all
dwelling conditions ranging from green to red, can be viewed as the
empty volume of a container. 9 6 To represent the subset of regulations
pertaining to the repair of red condition dwellings under minimum
housing standards, imagine solid bricks placed into the container.
Then imagine pouring water into the container until the container is
completely full. The bricks in the container represent the coverage of
the minimum housing statutes, which is limited to the repair of dwellings in order to render them fit for human habitation. In that space
occupied by the bricks, local governments must adhere to the procedures found in the minimum housing statutes. The water surrounding
the bricks, however, is governed by the general police power, because
the coverage of the minimum housing statutes does not extend any
further than the space occupied by the bricks. It is therefore important
to understand how much space is actually occupied by the bricks.
Figures 1 and 2 provide further illustration of the same point.
94. N.C. GEN. STAT. § 160A-443(3)(a) (emphasis added). Under the minimum
housing statutes, a public officer may issue an order "requiring the owner, within the
time specified, to repair alter or improve the dwelling in order to render itfitfor human
habitation ....
Id. (emphasis added).
95. See supra notes 71-72 and accompanying text.
96. For purposes of this illustration, regulations pertaining to the demolition of
such dwellings are not considered.
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.................................................................................................
Figure 1
The container below illustrates the universe of maintenance regulations governing vacant or abandoned dwellings
...........................
.............................
o.......................................o
-------------....................
..................
.
.
.
...
.
.
.
.
.
.
.
.
.
.
.
.
.
.
All remaining space, in green, yellow, and even red condition,
is governed by the general police power and represents regulations governing conditions that do not affect a determination
that the dwelling is "unfit for human habitation" (e.g., "good
repair" regulations).
In summary, local governments seeking to regulate vacant or
abandoned dwellings in green or yellow condition could enact regulations based solely upon the general police power. With respect to red
condition dwellings, the statutory authority applied will depend upon
the condition: regulation of conditions that render a dwelling unfit for
human habitation must adhere to the procedures set forth in the state's
minimum housing statutes, whereas good-repair regulations (or others
covering items with no bearing on the fitness of a dwelling) could rely
upon the general police power.
Our discussion could end here if the minimum housing statutes
established a well-defined and unalterable scope of regulationin other words, if the size of the "bricks" were fixed and could not
be changed. If that were the case, the limits of the minimum housing
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Figure 2
Applicability of the General Police Power and Minimum Housing Statutes
Conditions not determinative
of a dwelling's fitness or unfitness for human habitation
(e.g., aesthetic or "good repair" regulations)
Conditions determinative of a
dwelling's fitness or unfitness
for human habitation
General Police Power
General Police Power
Yellow Condition
Dwellings
General Police Power
General Police Power
Red Condition
General Police Power
Minimum Housing Statutes
Green Condition
Dwellings
Dwellings
statutes would be reasonably certain, and regulation of certain repairs
could be categorized as either determinative of the fitness of a dwelling
for human habitation, or not. However, as demonstrated in Part III
below, local governments have been granted some authority to manipulate the definition of "unfit for human habitation" in their individual
local ordinances. 97 Conditions regulated under good-repair ordinances in one community could be described as "unfit for human
habitation" in another. In other words, each local government can
potentially expand or narrow the applicable scope of its local minimum housing ordinance -essentially changing the size of the "bricks."
Thus, further examination of the minimum housing statutes is necessary in order to fully understand the regulatory authority of a local
government with respect to red condition dwellings.
III.
MINIMUM HOUSING STANDARDS FOR VACANT
OR ABANDONED DWELLINGS
Section A of this Part describes the operation of local minimum
housing ordinances enacted pursuant to the state's minimum housing
statutes. Section B, recognizing that local governments are permitted
to manipulate certain definitions within their minimum housing ordinances, analyzes the effects of such modifications. This examination
97. See infra note 104 and accompanying text.
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is intended to illuminate the scope of local authority under the minimum housing statutes, which in turn will help us to understand the
line between regulations derived from minimum housing authority
and those derived from the general police power.
A.
The Basic Operation of Minimum Housing Ordinances
As a threshold matter, authority under the minimum housing statutes lies dormant until a local government enacts an ordinance, which
must contain certain provisions.9 8 For example, all ordinances must
designate an officer to exercise the statutorily-prescribed powers. 9 9
Additionally, all ordinances must require the appointed officer to conduct a preliminary investigation into the condition of any dwelling for
which a petition signed by five citizens has been filed.10 0 Uniform procedures for ordering a repair or other corrective action for a substandard dwelling are set forth in the statute and must appear in any local
ordinance.' 0 ' As explained above in Part II, Section C, these procedures apply whenever a local government seeks to regulate a dwelling
that is unfit for human habitation.
While the statutes prescribe many provisions, there is some room
for local government creativity. For instance, what is perhaps the most
important defined term, "unfit for human habitation," is described at
length in the statute, but it can also be customized within each local
ordinance. The statutes note that dwellings which are unfit for human
habitation pose a threat to the health and welfare of the state's citizens,
and that a "public necessity exists for the repair, closing or demolition
of such dwellings."' 0 2 These "unfit for human habitation" dwellings
suffer from "defective conditions" such as "defects therein increasing
the hazards of fire, accident, or other calamities; lack of adequate ventilation, light, or sanitary facilities; dilapidation; disrepair; structural
defects; uncleanliness" which render them "dangerous or injurious to
the health, safety or morals of the occupants of the dwelling, the occu98. N.C. GEN. STAT. § 160A-443 ("Upon the adoption of an ordinance finding that
dwelling conditions of the character described in G.S. 160A-441 exist within a city, the
governing body of the city is hereby authorized to adopt and enforce ordinances relating to dwellings within the city's territorial jurisdiction that are unfit for human
habitation. These ordinances shall include the following provisions .
(emphasis
added)).
99. Id.
100. Id.
101. Id.
102. Id. § 160A-441.
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pants of neighboring dwellings, or other residents of the city."' 3 This
language, which emphasizes the rather extreme character of unfit
dwellings, might be considered somewhat limiting, perhaps restricting
the application of the ordinance to dwellings which are in extremely
bad condition, were it not for the presence of a discretionary relief
valve. By statute, local governments are granted authority to provide
"additional standards" in a local ordinance to guide public officers
with respect to the definition of "unfit for human habitation. ' 10 4 This
discretion is important and will be explored in more detail below.105
Once a local government determines that a property is "unfit for
human habitation," in accordance with the statutory procedures and
the local government's ordinance, 1 6 the designated public officer
must issue one of two possible orders: an order to "remove or demolish," or an order to "repair." The type of order issued depends on
whether the dwelling can be repaired at "reasonable cost," with local
governments exercising discretion here, as well, by defining in the ordinance what percentage of a dwelling's value constitutes a "reasonable
10 7
CoSt."'
Order to remove or demolish. If the cost of repair exceeds the "reasonable cost in relation to the value of the dwelling," then the public
officer shall issue an order requiring the property owner to "remove or
demolish" the structure.'0 8 Note that there is no option to order the
"repair" of the dwelling if the cost exceeds the defined "reasonable
103. Id. § 160A-444; cf. id. § 160A-441 (referring to conditions which are "dangerous or detrimental" rather than those which are "dangerous or injurious").
104. See id. § 160A-444 ("The ordinances [adopted by a city under this Part] may
provide additional standards to guide the public officers, or his agents, in determining
the fitness of a dwelling for human habitation.").
105. This power to manipulate the definition of "unfit for human habitation," and
its possible consequences, will be discussed in Part IIl.B.
106. There are certain notice and public hearing requirements associated with making this determination. See N.C. GEN. STAT. § 160A-443(2) (2007). Complaints that
state the dwelling is unfit for human habitation must be served on all property owners
and parties of interest. Id. After service of the complaint, a public hearing must be
held within ten to thirty days. Id. At the public hearing, all property owners and
parties of interest have the right to file answers and give testimony as to whether the
dwelling is unfit for human habitation. Id. The minimum housing statutes provide
detailed guidance for service of complaints and orders. See id. § 160A-445. See also
ANITA R.BROWN-GRAHAM, AFFORDABLE HOUSING AND NORTH CAROLINA LocAL GOVERNMENTS
6-7 (2006).
107. Act of July 1, 2009, sec. 7, § 160A-443(3), N.C. Sess. Laws 2009-279 ("[Tlhe
ordinance of the city may fix a certain percentage of [the value of the dwelling] as
being reasonable."). The consequences of manipulating this percentage will be discussed in Section B, infra.
108. Id.
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cost."'1 9 Because case law suggests that unfit dwellings may be regulated "only" in the manner provided by the minimum housing statutes, 110 it would be impermissible for the public officer to order
"repair" of dwellings if the cost of repair would exceed the defined "reasonable cost." Practically speaking, however, repair by the owner
would probably end the matter.
If the property owner fails to comply with an order to remove or
demolish, the local government may effectuate the order-by demolishing, not repairing-with any costs converted to a lien on the property,
and collected as a special assessment (similar to a property tax
lien)."' The collection methods available for these liens are more
robust than for mechanics liens (the collection mechanism available
under the general police power), and special assessment liens, unlike
mechanics liens, survive foreclosure." 2
As noted in the Introduction, however, this Article's purpose is to
describe efforts to preserve housing, not demolish it. Accordingly, let
us turn our attention to the minimum housing procedures to be followed in situations in which a dwelling can still be preserved.
Order to repair. If the dwelling can be repaired at "reasonable cost
in relation to the value of the dwelling," then the public officer shall
issue an order requiring the property owner "to repair, alter or improve
the dwelling in order to render it fit for human habitation." 1 1 3 At the
time that a local government issues an order to repair, it may supple-
ment that order with an order to vacate and close the dwelling, but
only if it is determined that "continued occupancy during the time
allowed for repair will present a significant threat of bodily harm."1 14
109. Although the local government must order the owner "to remove or demolish"
the unfit dwelling, the owner is entitled to "a reasonable opportunity to bring it into
conformity with the housing code." N.C. GEN. STAT. § 160A-443(5).
110. See supra notes 88-92 and accompanying text.
111. N.C. GEN. STAT. § 160A-443(6)(a) ("[T]he amount of the cost of repairs, alterations or improvements, or vacating and closing, or removal or demolition by the public
officer shall be a lien against the real property upon which the cost was incurred,
which lien shall be filed, have the same priority, and be collected as the lien for special assessment provided in Article 10 of this Chapter."). Special Assessment liens are
identical to property tax liens except for the fact they are by statute junior to any local,
state or federal tax liens. Id. § 160A-233(c). Special assessments may be collected "in
the same manner as property taxes," which means local governments may use garnishment and attachment of personal property (including bank accounts, wages, and other
assets) in addition to real property foreclosure remedies. See id. § 160A-228.
112. See id. §§ 105-362, -375(i).
113. Act of July 1, 2009, sec. 7, § 160A-443(3)(a), N.C. Sess. Laws 2009-279.
114. Id. The "significant threat of bodily harm" calculus takes into account not only
the current condition of the property, but also the nature of the repairs that are
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The use of the phrase "during the time allowed for repair" suggests the
drafters intended this "vacate and close" order to be temporary, lasting
only until the ordered repairs are completed.
If the property owner fails to make the ordered repairs within the
time allotted in the order, the local government is provided two
options: it "may" (1) "cause the dwelling to be repaired, altered, or
improved," essentially effectuating the repair order, or (2) cause the
dwelling to be "vacated and closed" without effectuating the repair
order. 115
If the government opts to effectuate the order by repairing the
dwelling, then that essentially concludes the matter. Here, as with
effectuation of an order to demolish, the local government's costs
become a lien on the property that may be collected as a special
1 16
assessment.
If the local government elects to vacate and close the dwelling
without effectuating the repair order, then any costs associated with
boarding up the structure become a lien on the property, with the lien
collected as a special assessment as described above for other
orders.1 17 Once the dwelling is vacated and closed, unless it is
repaired by the owner, the local government must leave it in its vacated
and closed state until either (1) the dwelling deteriorates to the point
that the cost of repair exceeds a "reasonable cost," in which case the
local government must start over with new proceedings to obtain an
order to demolish the dwelling," 8 or (2) the local government qualifies
for, and avails itself of, the "abandonment of intent to repair" procedures, which assign special processes for repairing or demolishing
dwellings which have been vacated and closed. 119
"Abandonment of the intent to repair" procedure for qualifying
municipalities. Prior to amendments enacted in 2009, the minimum
housing procedures required local governments to give every owner of
an unfit dwelling a choice whether to repair the structure or to vacate
required and additional risks due to the presence of minors under the age of eighteen
or occupants with physical or mental disabilities.
115. Act of July 1, 2009, sec. 7, § 160A-443(4), N.C. Sess. Laws 2009-279.
116. N.C. GEN. STAT. § 160A-443(6)(a) (2007). See supra notes 111-13 and accompanying text.
117. Id.
118. See Newton v. City of Winston-Salem, 374 S.E.2d 488, 490-91 (N.C. Ct. App.
1988) (asserting that an order to demolish is a different determination from an order
to repair and requires a new hearing).
119. Act of July 1, 2009, sec. 7, § 160A-443(5a), N.C. Sess. Laws 2009-279.
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and close it. 120 Not surprisingly, many owners without sufficient
resources to repair a dwelling simply opted to vacate and close it, leaving it in its unfit state. When those vacated and closed dwellings
became blighting influences in the community, a local government
had no recourse but to wait until the dwelling deteriorated further, to
the point that it became eligible for demolition. This result was untenable to many local governments.
To address this specific problem, a remedy was developed and
remains available to municipalities in counties with populations of
over 71,000 and municipalities with populations exceeding
190,000,121 as well as to certain enumerated smaller municipalities. 1 22
If one of these eligible local governments finds that a property owner
has "abandoned the intent and purpose to repair" by keeping a dwelling vacated and closed for one year pursuant to an order to "repair or
vacate and close," and certain other findings are made about the dwelling's blighting influence, then the local government may enact one of
two ordinances. The first ordinance, applicable only if repairs can be
made at a cost not exceeding 50% of the "then current value of the
dwelling," is an order to "either repair or demolish and remove the
dwelling within 90 days."' 2 3 The second ordinance, applicable if
repairs would exceed the 50% threshold described above, orders the
owner to "demolish and remove the dwelling within 90 days. ' 124 If an
owner fails to comply with any of these orders, then the appointed
public officer "shall effectuate" the orders with the costs becoming a
lien on the property and collected as a special assessment. 2 5 The oneyear waiting period places a limit on the amount of time that a local
government must suffer the blighting influence of a vacated and closed
dwelling. Prior to the amendments, local governments without access
to the abandonment of intent to repair procedures were stuck-they
had to wait until the dwelling deteriorated to the point that it became
120. Prior to October 1, 2009, when the amendments became effective, local governments were not permitted to order an owner solely to repair a dwelling; rather, the
order was required to give owners a choice: either repair or vacate and close an unfit
dwelling. See id.
121. N.C. GEN. STAT. § 160A-443(5a) (2007).
122. Id. § 160A-443(5b) (granting the same power as section 160A-443(5a) and noting that "[tihis subdivision applies to the Cities of Eden, Lumberton, Roanoke Rapids,
and Whiteville, to the municipalities in Lee County, and the Towns of Bethel,
Farmville, Newport, and Waynesville only").
123. Id. § 160A-443(5a) (emphasis added).
124. Id.; see also id. § 160A-443(5b) (authorizing enumerated smaller municipalities
to employ identical procedures).
125. Id. § 160A-443(6)(a).
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eligible for demolition, at which time they could restart the original
1 26
process to obtain an order to demolish.
The enactment of the 2009 amendments has made the abandonment of intent to repair procedures less important, because owners are
no longer granted the option to vacate and close an unfit dwelling; now
they are ordered simply to repair it. If an owner fails to perform the
ordered repair, the local government-not the owner-decides whether
to repair or to vacate and close the dwelling. All local governments can
therefore avoid the vacate and close problem by simply repairing unfit
dwellings rather than vacating and closing them. Unfortunately, this
may not be a viable option for local governments with insufficient
resources to pay for repairs. Some local governments will therefore
continue to order dwellings vacated and closed, so the abandonment of
intent to repair provisions remain relevant. These special provisions,
which were left intact by the 2009 amendments, continue to provide
the only means of addressing a vacated and closed dwelling that acts
as a blighting influence but is not yet eligible for demolition under
12 7
standard procedures.
One exception must be mentioned. The 2009 amendments introduced a new concept to the minimum housing statutes by creating a
temporary vacate and close order for the purpose of protecting occupants
12
during the time allowed for repair.'
If applied, a dwelling will be subject to an outstanding order to repair at the same time that it is under a
temporary vacate and close order. Since the vacate and close order is
by definition a temporary order for the purpose of making repairs, it
must be the case that any local government may effectuate a repair
order for dwellings subject to this temporary vacate and close order,
even if the local government is not eligible to employ the abandonment
of intent to repair procedures. What is not clear is how much time a
local government has to effectuate a repair order following an owner's
failure to repair a dwelling under a temporary vacate and close order.
It is probably safe to say that the time period is very brief. After all, the
abandonment of intent to repair procedures become applicable once a
dwelling has been vacated and closed for one year, so the time period
126. See supra note 118 and accompanying text.
127. To interpret the statute otherwise-e.g., to suggest that a local government
could effectuate a repair order at any time even after it has ordered a dwelling vacated
and closed-would essentially render the abandonment of intent to repair procedures
meaningless, violating a cardinal principle of statutory interpretation. See supra note
93.
128. Dwellings may be vacated and closed "during the time allowed for repair" if
there exists a threat of bodily harm or additional risks posed to occupants.
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for effectuation without resorting to abandonment of intent to repair
procedures must stop short of the one year point.1 29 Unfortunately,
we do not know how far short.
We cannot be sure how local governments will adapt to the
revised statutory regime. Local governments unable to employ abandonment of intent to repair procedures may try to avoid issuing orders
for dwellings to be vacated and closed, since it is uncertain to what
degree such an order would tie their hands. With an abundance of
resources, the obvious answer for these jurisdictions is to effectuate all
repair orders immediately following an owner's failure to repair. For
jurisdictions unable to pay for repairs, however, choices are limited.
Without resources to effectuate a repair order immediately, and without clear authority to enforce a repair order once a dwelling is vacated
and closed, these local governments may instead seek to delay or avoid
taking any action after an owner fails to comply with a repair order.
Their hope in delay would be that the repair order would remain valid
until such time that the local government secured sufficient resources
to effectuate the repair. The time period available for effectuating such
a repair order is itself an unknown, but it is likely limited by reasona130
bleness and, in any event, subject to due process considerations.
B. Manipulating Minimum Housing Ordinance Definitions
The minimum housing statutes grant local governments authority
to modify two important parameters in minimum housing ordinances:
(1) "reasonable cost," which is the percentage of a dwelling's value that
determines which order is to be issued by the local government, either
"remove or demolish" or "repair," and (2) "additional standards,"
which guide public officers with respect to the definition of "unfit for
human habitation." What is the effect of modifying these definitions
in local ordinances?
"Reasonable Cost" Percentage. Adjustments to the "reasonable
cost" threshold influence the level of deterioration at which a local government may no longer issue an order to repair, and instead must
issue an order to remove or demolish. For example, a local government may consider lowering the reasonable cost threshold to 20%. In
this example, once the cost of repairing a dwelling exceeds 20% of its
current value, the local government must order the dwelling's demoli129. Act of July 1, 2009, sec. 7, § 160A-443(5a), (5b), N.C. Sess. Laws 2009-279.
130. Due process considerations may include any changes over time in the status of
a dwelling, changes in ownership of a dwelling, and excessive periods of delay between
the expiration of the time allowed for repair and the moment at which a local government seeks to effectuate the repair order.
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13 1
tion, as ordering the dwelling's repair would not be authorized.
This low reasonable cost threshold has the effect of narrowing the
availability of the "repair" option and speeding the arrival of the
moment at which the remove or demolish order must be applied to a
troubled property. Imagine that the public officer determines that a
dwelling "unfit for human habitation" could be repaired for 2 5 % of its
current value, thereby exceeding the 20% threshold. Such a dwelling
might not be terribly dilapidated and therefore might be a good candidate for preservation; yet an order to repair would not be an option.
The local government would hold only the power to order the dwelling
132
to be removed or demolished.
For this reason, we would expect a lower reasonable cost threshold to result in more demolition orders, and hence more demolitions.
Thus, a lower threshold might appeal to a local government facing a
shrinking populace, with excess housing capacity. However, most cities and counties in North Carolina face the opposite problem. The
U.S. Census Bureau has forecast that North Carolina will increase its
population by more than four million people between the years 2000
and 2030,133 so North Carolina local governments would be expected
to embark on housing preservation initiatives rather than demolition
programs. A higher threshold would be more consistent with preservation efforts, because it would lead to greater numbers of initial orders
to repair rather than to remove or demolish.
Additional standardsfor the definition of "unfit for human habitation." The minimum housing statutes permit local governments to
provide "additional standards" in their minimum housing ordinances
to guide public officers with respect to the definition of "unfit for
human habitation," producing two primary consequences. 1 34 First,
this flexibility may lead to confusion over the regulatory coverage of
the general police power, as compared with the minimum housing
statutes, simply because the definition of unfit for human habitation
plays a substantial role in determining whether a particular condition
may be regulated under the general police power or under the mini131. See supra note 109 and accompanying text. For purposes of this example, we
will ignore the possibility that demolition of a building in such relatively good condition might give rise to a constitutional taking.
132. Id.
133. Press Release, U.S. Census Bureau, Florida, California and Texas to Dominate
Future Population Growth (Apr. 21, 2005), http://www.census.gov/press-release/
www/releases/archives/population/004704.html.
134. See N.C. GEN. STAT. § 160A-444 (2007) ("The ordinances [adopted by a city
under this Part] may provide additional standards to guide the public officers, or his
agents, in determining the fitness of a dwelling for human habitation.").
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mum housing statutes. Second, this flexibility provides a local government with an opportunity to expand or reduce the scope of its local
ordinance according to its preference. On one hand, the flexibility is
beneficial because it permits a local government to customize its
response to substandard housing. On the other, it may tempt a local
government to expand the coverage of its ordinance, for example, to
conditions that might not actually be classified as unfit for human
habitation as a matter of statutory interpretation, which ultimately
invites claims that the activities authorized by the ordinance are ultra
vires.
The point is best illustrated by describing the effects of a hypothetical municipality's additional standards that relate to the definition
of "unfit for human habitation." Imagine a municipality defining unfit
for human habitation as follows: A dwelling shall be unfit for human
habitation if it fails to meet one or more of the following standards:
(1) no deterioration due to the elements because of a lack of preventive
maintenance, consisting of painting, weatherproofing, and repair;
(2) windows shall have panes without cracks or holes; (3) accessory
buildings are maintained in a state of good repair; (4) driveways and
and nonsidewalks are maintained in good repair; and (5) combustible
135
premises.
the
from
removed
is
rubbish
combustible
Some may view these as surprisingly broad standards. A public
officer could conceivably declare a dwelling as unfit for human habitation for having a cracked window pane; or perhaps for a lightly deteriorated panel on the exterior of a dwelling due to worn paint; or
perhaps for an accessory building found in disrepair, even though it is
not used for human habitation. We cannot say for certain that these
standards are overbroad, because there is no judicial precedent clarifying at what point a minimum housing ordinance becomes ultra vires
for applying an overly-expansive definition of "unfit for human
habitation."
The effect of manipulating "additional standards" must also be
understood with respect to the line dividing the applicability of the
general police power and the minimum housing statutes. The additional standards listed above serve to broaden the applicability of the
local government's minimum housing ordinance to conditions that
might not be considered "unfit" in another municipality. Accordingly,
the local government employing these standards would apply its minimum housing ordinance and the procedures outlined in the minimum
135. While the list provided is hypothetical, these conditions are derived from
existing minimum housing ordinances in North Carolina, copies of which are on file
with the author.
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housing statutes to this expanded set of conditions. For local governments that prefer to operate within the confines of the minimum housing statutes, this creates a perceived benefit because the minimum
housing statutes would apply to a broader range of conditions.
At the same time, these broader minimum housing standards
would have the effect of removing the defined conditions from the purview of the general police power. As we learned above in Part II, Section C, any conditions contributing to the fitness of a dwelling for
human habitation may only be regulated by the minimum housing
statutes. Figure 3, below, compares the original container diagram
found in Figure 1 to a revised container, illustrating a minimum housing ordinance employing additional guidance to expand the definition
of unfit for human habitation. The bricks have expanded into space
previously considered yellow, thus illustrating the fact that the minimum housing ordinance, as modified by additional guidance, now covers dwellings that previously would have been considered yellow
condition dwellings.
The trade-offs are worth considering. Minimum housing ordinances have their advantages: the statutory procedures are already
established; some case law exists; notice requirements are clearly set
forth; hearings are administrative in nature rather than judicial; 136 and
any costs incurred to effectuate orders following noncompliance
become a high-priority lien.' 37 On the other hand, the general police
power has some appeal of its own: it can seamlessly regulate aesthetic
and non-aesthetic conditions at an early stage before a dwelling
becomes unfit for human habitation; the ability to levy fines or civil
penalties may also be a powerful tool; 1 38 the absence of an existing
regulatory regime and procedures allows for some creativity in design
and implementation; and jurisdictions with limited resources and not
eligible to use the "abandonment of intent to repair" procedure may
run into difficulty using the minimum housing statutes to regulate
dwellings. 139
136. See supra note 106.
137. See N.C. GEN. STAT. § 160A-443(6)(a).
138. See id. §§ 160A-175(a), (c) (for cities); id. §§ 153A-123(a), (c) (for counties).
See infra Part IV for a discussion of the authority to assess fines or civil penalties under
the general police power, and why there may not be authority to assess fines and civil
penalties for violations of minimum housing ordinances.
139. See supra notes 120-30 and accompanying text. This list is not exhaustive, but
rather provides an overview of the advantages and disadvantages of each regulatory
regime.
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39
Figure 3
The container on the left is taken from Figure 1 and illustrates a minimum housing ordinance not employing "additional guidance," The container on the right illustrates a minimum housing ordinance employing
"additional guidance" to expand the definition of "unfit for human habitation," which in turn expands the
coverage of the minimum housing ordinance (represented by the enlarged bricks). Note that some dwellings previously considered to be in a "yellow condition" would now be categorized as being in "red condition" (illustrated by encroachment of red space into formerly yellow space).
Minimum housing ordinance with no
"additional guidance" for the definition
of "unfit for human habitation."
Minimum housing ordinance employing "additional
guidance" to expand the conditions considered as
"unfit for human habitation."
Despite any comparative advantage one authority may have over
the other, a local government seeking a comprehensive approach to the
regulation of vacant and abandoned dwellings does not face an
"either-or" choice. Rather, in constructing a comprehensive regulatory
program, a local government must rely upon its authority under both
the minimum housing statutes and the general police power. The need
to use both authorities produces some interesting and difficult
challenges.
IV.
PUTTING IT ALL TOGETHER: WORKING WITHIN EXISTING
STATUTORY AUTHORITY TO ENACT A VACANT
PROPERTY REGISTRATION PROGRAM
A large portion of this Article thus far has been devoted to explaining the general police power and North Carolina's minimum housing
statutes. The foregoing analysis, standing alone, is worthwhile, as it
sheds light on a confusing area of North Carolina law with significant
practical importance to local governments and citizens. However, just
as important is that the analysis provides the necessary context for the
following discussion illustrating a novel approach in North Carolina to
regulating vacant or abandoned dwellings known as "vacant property
registration programs." As explained below, this approach draws on
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local government authority under both the general police power and
the minimum housing statutes. The intent of this discussion is not to
detail every aspect of a vacant property registration program, but
rather to use the vacant property registration concept as a means of
illustrating the interplay of the two authorities and how the complexity
of North Carolina's statutory regime confounds local government
efforts to implement a comprehensive regulatory program for vacant
and abandoned housing.
Although not yet attempted in North Carolina, vacant property
registration programs have been employed by municipalities in other
states to address the problem of vacant or abandoned housing.' 40 A
vacant property registration program typically consists of the follow4
ing components:1 1
(1) A requirement for owners to register their vacant propertygardless of the property's condition-with a local government official within some short period of time following
vacancy and to designate an agent for service of process.
(2) A requirement for owners not located in the local jurisdiction to hire a local professional maintenance company to
provide twenty-four-hour maintenance service for the property; to notify the local government of the contact information for the retained maintenance company; and to carry
liability insurance coverage to protect against potential vandalism or other damage resulting from abandonment.
(3) Enumeration of standards by which the property must be
maintained, such as maintaining existing features of a dwelling in good repair and maintaining the exterior appearance
of a dwelling, along with procedures for effectuating orders
in the event of noncompliance.
(4) A periodic fee to fund costs associated with the regulatory
program (i.e., program adrfministration and inspectors' time).
Some programs refund a portion of the fee if the property is
140. For a list of vacant property registration programs established in the United
States, see Safeguard Properties, Vacant Property Registration Ordinances, http://
www.safeguardproperties.com/vpr/city.php (last visited Oct. 18, 2009) (indicating
that no North Carolina programs have been established, though the author continues
to work with one local government interested in establishing a program).
141. See generally Joseph Schilling, Code Enforcement and Community Stabilization:
The Forgotten First Responders to Vacant and Foreclosed Homes, 2 ALB. GOV'T L. REV.
101, 128-45 (2009). See also ALAN MALLACH, METROPOLITAN POLICY PROGRAM AT BOOKINGS, TACKLING THE MORTGAGE CRISIS: 10 ACTION STEPS FOR STATE GOVERNMENT 13-15,
26 nn.50-52 (2008), availableat http://www.brookings.edu/-/media/files/rc/papers/
2008/0529_mortgage_crisisvey/529_mortgage-crisisvey.pdf.
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re-occupied within a certain period of time. The inspections
may consist of frequent police patrols and periodic fire and
code inspections to ensure that the vacant property remains
secure and undamaged.
(5) Penalties for violations.
Each of these components will be addressed in turn and evaluated in
light of local government authority to conduct these activities in North
Carolina.
Registration. We have already established that vacant and abandoned dwellings pose a serious threat to communities. 142 Vacant
property registration programs mitigate the threat by establishing local
government awareness of vacancies, and if designed into the program,
by triggering a program of regular monitoring by government officials,
such as code inspectors, police, and fire officials. A registration
requirement would be enacted by a local government under its police
power authority. Registration serves purposes greater than mere aesthetics, so the A-S-P Associates reasonableness test is applied to determine if it is a valid exercise of the police power.' 4 3 Since the regulation
requires an owner to do little more than register a vacant property,
there is little doubt that it would be viewed as a reasonable means of
achieving a legitimate government purpose.' 4 4
Having established that the registration component is a valid exercise of the police power, is it preempted by the minimum housing statutes? There is no risk of preemption, because registration of a vacant
dwelling in any condition (whether green, yellow, or red) is not done
for the purpose of rendering the dwelling fit for human habitation.
Rather, it is done to trigger awareness by the local government. Furthermore, registration applies to green and yellow condition dwellings
as well as to red, so a dwelling's fitness or unfitness for human habitation is irrelevant for the purposes of registration. Registration therefore falls outside of the scope of the minimum housing statutes. Even
when registration is applied to a red condition dwelling, the dwelling
likely simultaneously exhibits conditions rendering it "unfit" as well as
conditions with no bearing on fitness (such as good repair of existing
aesthetic or non-structural features). Hence, a local registration
requirement can be enacted for the purpose of regulating conditions
not related to determinations of fitness or unfitness, thereby avoiding
142. See supra notes 3-7 and accompanying text. Recall that even green condition
dwellings pose a threat if vacant.
143. See supra Part II.A.
144. Id.
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any interference with the preemptive space of minimum housing
statutes.
Retain a professional maintenance company and carry insurance.
Using similar preemption analysis as that described above for registration, a local government regulation requiring an owner to hire a professional maintenance company to maintain a vacant dwelling and to
carry insurance is unrelated to minimum housing standards. It would
therefore fall outside the scope of the minimum housing statutes. The
relevant inquiry is whether it would be a valid exercise of the general
police power. We can be reasonably sure that such a requirement,
properly tailored, would pass the A-S-P Associates reasonableness test
in light of the purpose served.1 4 If, however, the stricter State v. Jones
balancing test for aesthetic regulations is applied, we cannot be certain
whether a court would find that the public benefit outweighs the private burden. 146 Recall that Jones requires a case-by-case analysis of aesthetic regulations, so judicial determinations would necessarily be
highly contextual. 1 47 For example, courts would likely be sympathetic
to an owner, perhaps living within a few miles of her registered vacant
dwelling, who argues that she can maintain her vacant dwelling adequately on her own without hiring a local maintenance company. As
another example, an owner could argue that she has complied with the
maintenance requirement by hiring a non-professional to maintain the
property (e.g., by contracting with a neighbor for the maintenance of
the dwelling). Through creative ordinance drafting, reasonable accommodations can be made to address these circumstances, such as waiving the requirement to hire a professional maintenance company for
owners who (1) reliably demonstrate an ability to maintain the property and (2) have not received any citations for maintenance violations
in the previous quarter. Building in such accommodations should
improve the regulation's chances of overcoming either the A-S-P Associates reasonableness test or the Jones balancing test.
Maintenance standards and local government effectuation in the
event of non-compliance. The third component-enumeration of maintenance standards and procedures for effectuation in the event of noncompliance-must fully address the tension between the general police
power and minimum housing statutes in North Carolina law. 4 " In
establishing maintenance standards, local governments may wish to be
explicit about which standards address a dwelling's fitness or unfit145.
146.
147.
148.
See id.
See supra Part I.B.
See supra note 60 and accompanying text.
See supra Part I1.C.
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DWELLINGS
ness for human habitation, and which do not. We know this distinction has no bearing on the regulation of green or yellow condition
dwellings, as illustrated above in Figure 2. The distinction only matters once a dwelling is declared unfit for human habitation and enters
red condition. At that point, any condition which, if repaired, would
render the dwelling fit for human habitation, would be regulated pursuant to the procedures of the minimum housing statutes. All other
substandard conditions (such as those regulated by a good repair regulation of non-structural or aesthetic features) would continue to be regulated under the authority of the general police power. The
procedures would necessarily be different for each of the two sets of
conditions. To illustrate the point, for conditions regulated pursuant
to the minimum housing statutes, local governments may avail themselves of administrative (rather than judicial) proceedings all the way
through enforcement. 14 9 For repair of other substandard conditions
regulated pursuant to the general police power, a court order must be
obtained for local government effectuation. 5 ° This provides the clearest demonstration of how the tension between the general police
power and the minimum housing statutes complicates local govern151
ment efforts to enact comprehensive code enforcement measures.
Periodicfee. The fourth component assesses on registrants a periodic fee calculated to defray the costs of administering the registration
program and the costs associated with regular inspections (such as
dedicated public safety resources, fire inspections, and code inspections). Such fees are permitted in North Carolina, provided that the
fees are calculated only to defray the costs of the regulatory pro-
149. See supra notes 94-95 and accompanying text. For a discussion of the administrative procedures, see supra note 106.
150. See N.C. GEN. STAT. § 160A-175(d)-(e) (2007) (for cities); id. § 153A123(d)-(e) (for counties).
151. The dividing line between the two authorities is a condition unique to North
Carolina. In other states, there is no dividing line at all, so vacant property registration ordinances enacted in those other states will look different from the North Carolina ordinance envisioned here. See, e.g., CAL. Civ. CODE § 2929.3(b) (West 2008)
(defining "failure to maintain" in a way that blends aesthetic or "good repair" elements
with elements that might contribute to a determination that a dwelling is "unfit for
human habitation," specifically: "failure to care for the exterior of the property, including, but not limited to, permitting excessive foliage growth that diminishes the value of
surrounding properties, failing to take action to prevent trespassers or squatters from
remaining on the property, or failing to take action to prevent mosquito larvae from
growing in standing water or other conditions that create a public nuisance").
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gram.' 5 2 It would seem appropriate for such fees to be assessed
against the owner of the affected dwelling in the same way that fees for
other inspection programs are assessed. A program of regular inspections for a vacant dwelling is, after all, a service for the owner of the
dwelling as much as for the surrounding community, as it is designed
to improve the chances that the owner's vacant property remains
secure and well-maintained.
The fee structure deserves some attention. Local governments 15in3
other states have built creative incentives into their fee structures.
Some of these incentives, such as fee waivers for dwellings that are
reoccupied within a certain period of time after falling vacant, can be
replicated in North Carolina.' 5 4 Others, such as successive fee
increases for dwellings remaining vacant for longer periods of time, are
not permitted in North Carolina, unless the fees are tied to actual costs
of administering the regulatory program. 155
One additional wrinkle bears mentioning. Just as local governments must be mindful under which authority (general police power
or minimum housing) they are acting when establishing maintenance
standards, so too must they pay attention to the dividing line when
establishing fees. As already mentioned, a local government may
establish a fee to offset costs of regulatory activities undertaken pursuant to the general police power, such as the vacant property registration and inspection program envisioned here.' 5 6 However, it is not
clear whether fees are permissible for activities undertaken pursuant
to the minimum housing statutes. This wrinkle arises because of language in the minimum housing statutes suggesting that local governments will fund minimum housing standards inspections and
activities with appropriations from their general revenue fund.' 5 7
Costs of effectuating orders become liens on affected property, but
there is no mention of fees per se. 158 Recall that Newton suggests that
unfit dwellings may be regulated "only" in the manner provided by the
152. See Homebuilders Ass'n of Charlotte, Inc. v. City of Charlotte, 442 S.E.2d 45,
51 (N.C. 1994) (concluding that a city has authority to assess user fees to defray the
costs of regulation, provided such fees are reasonable).
153. See Schilling, supra note 141, at 132.
154. See supra note 152 and accompanying text.
155. See id.
156. See id.
157. See N.C. GEN. STAT. § 160A-449 (2007).
158. Id. § 160A-443(6).
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minimum housing statutes. 1 59 The ability to establish fees for activi-
ties under the minimum housing statutes is therefore in question. In
contrast, we have no such concerns about fees with respect to activities
undertaken pursuant to the general police power. Therefore, fees may
be charged for a vacant property registration program, but when calculating the fees, the costs of minimum housing activities should not be
included.
Penalties. The final component, civil penalties (or fines) for noncompliance, raises similar concerns with respect to the distinction
between activities undertaken pursuant to the general police power, as
opposed to the minimum housing statutes. There exists clear authority to assess civil penalties against owners for violations of ordinances
enacted pursuant to the general police power,' 60 such as the vacant
property registration program envisioned here. For minimum housing
activities, however, we cannot be so certain. No authority to assess
civil penalties (nor fines) is found within the minimum housing statutes. Following the same reasoning applied above for periodic fees,
case law suggests that local governments may "only" exercise minimum housing powers in the manner provided in the minimum housing statutes. 16 1 Accordingly, it is probably not permissible to use civil
penalties (or fines) to enforce violations of minimum housing ordinances.1 6 2 This is yet another example of a notable difference between
159. See Newton v. City of Winston-Salem, 374 S.E.2d 488, 491 (1988) ("The statute specifically states that cities and counties may exercise such powers only 'in the
manner herein provided."'). See also supra notes 89-90 and accompanying text.
160. See N.C. GEN. STAT. § 160A-175(c) (for cities); id. § 153A-123(c) (for counties).
161. See supra note 159 and accompanying text.
162. Some North Carolina local governments have nonetheless enacted fines or civil
penalties for violations of minimum housing ordinances. Cities and counties probably
rely upon the general authority granted by sections 160A-175 and 153A-123, respectively, which permit them to enforce violations of ordinances with fines or civil penalties. As a matter of statutory interpretation, however, this argument rests on shaky
ground. The minimum housing statutes were enacted during the Dillon's Rule era
when the general enforcement mechanisms just mentioned were not available to local
governments. At that time, Dillon's Rule restricted local government authority to that
specifically granted by statute. The statute contained no authority for fines, so an
argument can be made that the legislature never intended to permit local governments
to use fines to enforce minimum housing standards. Additionally, fines and civil penalties could be considered repugnant to the procedures set forth in the minimum housing statutes. Protections for owners-such as notice, hearings, required findings, and
wait periods prior to effectuation under abandonment of intent to repair procedureswould essentially be eviscerated if a local government could simply fine an owner for
each day's continuing violation of an order to repair. See id. §§ 153A-123(g), 160A174(g). Consider, finally, the result of Newton v. City of Winston-Salem (decided after
the date that the General Assembly over-ruled Dillon's Rule) that "only" the minimum
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general police power authority and minimum housing authority, further illustrating the challenge local governments face in seeking to
enact comprehensive regulations governing vacant and abandoned
dwellings.
One comment should be made regarding the amount of penalty
set by local governments. Proponents of vacant property registration
programs advise local governments to maximize the punitive effect of
these programs. 16 3 In North Carolina, civil penalties for violations of
ordinances are currently capped at five hundred dollars, 1 6 4 but a local
ordinance may provide that each day's continuing violation is a separate and distinct offense. 1 65 Therefore, these penalties may be a powerful enforcement mechanism, particularly given the collection tools
166
available to local governments.
A common thread runs through the above examination of components of a vacant property registration program: local governments
must pay close attention to differences between actions taken pursuant
to the general police power and those taken pursuant to minimum
housing statutes. We have now seen several examples of program components-maintenance standards, effectuation in the event of noncompliance, fees, and civil penalties-for which the tension between the
general police power and minimum housing statutes complicates local
government efforts to establish a comprehensive regulation governing
vacant and abandoned dwellings. Implementation of these basic components sometimes hinges on which underlying authority, either the
general police power or minimum housing statutes, serves as the basis
for regulation.
V.
CONCLUSION AND POLICY RECOMMENDATIONS
Local governments in North Carolina have been granted sufficient
authority under existing statutes to implement adequate regulation of
vacant and abandoned dwellings. However, as highlighted in this Article, the statutory authority is convoluted, and cobbling together a
housing procedures may be used to regulate unfit dwellings. See 374 S.E.2d at 491.
Taken together, these authorities make it difficult to argue that fines or civil penaities
are permitted for enforcement of minimum housing ordinances.
163. See MA.LLACH, supra note 141, at 14, 26 n.50; see also CAL. CIv. CODE
§ 2929.3(a)(1) (West 2008) ("A legal owner shall maintain vacant residential property
purchased by that owner at a foreclosure sale, or acquired by that owner through foreclosure under a mortgage or deed of trust. A governmental entity may impose a civil
fine of up to one thousand dollars .
.
. per day for a violation.").
164. See N.C. GEN. STAT. §§ 14-4, 153A-123(b), 160A-174(b).
165. See id. §§ 153A-123(g), 160A-174(g).
166. See, e.g., id. §§ 105A-1 to -16 (containing the Setoff Debt Collection Act).
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DWELLINGS
coherent and comprehensive policy is a complicated matter. It may be
worthwhile to examine ways to provide clarity and to enhance the
authority of local governments to regulate vacant and abandoned
dwellings. Two basic approaches are considered: (1) making minor
modifications to enhance local government authority without dismantling the existing regulatory regimes, and (2) enacting an overhaul or
replacement of the existing regimes.
In the first approach, some minor modifications could be made to
the existing regulatory framework, currently governed by the general
police power and the minimum housing statutes, to enhance local government regulatory authority and flexibility without dismantling the
existing systems. Without attempting to address every possible scenario, this article has shed light on two general areas that could benefit
from a statutory remedy.
One modification involves the "abandonment of intent to repair"
procedure.1 6 7 Currently, this procedure is available only to populous
16 As explained above, 16 9
jurisdictions and a few select municipalities.
jurisdictions not eligible to employ this special procedure may try to
avoid issuing orders to vacate and close dwellings, because they will
not be certain to what degree such an order would tie their hands. The
problem could be eliminated by making the procedure available to all
local governments regardless of population. This is not to suggest that
every local government should be required to adopt the abandonment
of intent to repair procedure. In the same way that the minimum housing statutes remain dormant until a local government enacts an ordinance pursuant to the statutes, the abandonment of intent to repair
procedure could remain dormant until adopted formally by a local
governing body. The option to employ abandonment of intent to
repair procedures would prove helpful to those local governments currently stymied in their efforts to deal with vacated and closed
dwellings.
Another helpful modification would address the difficulties posed
by the imprecise seam between the general police power and the minimum housing statutes. It would be a difficult task for any public official to define precisely the boundaries of regulatory activity under
each authority. As explained above, this boundary truly matters to
local governments developing a comprehensive regulatory scheme
because powers and processes are different depending on whether the
local government is acting under the general police power or the mini167. See supra notes 120-30 and accompanying text.
168. Act of July 1, 2009, sec. 7, § 160A-443(5a), (5b), N.C. Sess. Laws 2009-279.
169. See supra notes 120-30 and accompanying text.
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mum housing statutes. If, for example, a local regulator gets it wrong
and attempts to apply the general police power in an area covered by
the minimum housing statutes, then the local regulator's activity could
be voided as inconsistent with the minimum housing statutes. The
consequences of getting it wrong-and even the uncertainty of getting
it right-could dissuade local governments from enacting comprehensive policies addressing vacant and abandoned housing. Given the
negative externalities inflicted on communities by vacant and abandoned housing, it is difficult to believe that this uncertainty was
intended by the General Assembly.
It should be a simple matter to provide clarity: the General Assembly could explicitly overrule Newton and permit local governments to
regulate red condition dwellings under either (or both) of the general
police power and minimum housing statutes. The consequence of
such legislative action would not be to expand the regulatory reach of
the minimum housing statutes, as those statutes would continue to
apply only to conditions that render a dwelling unfit for human habitation. The effect, rather, would be an expansion of the general police
power into the area previously excluded by the minimum housing statutes. As a result, local governments would not have to fret over the
dividing line between the general police power and the minimum
housing statutes. For those cases in which public officials were unsure
whether the general police power or the minimum housing standards
apply, this approach would allow them to move forward with confidence under the general police power.
A second approach suggests more sweeping changes to the
existing statutory regimes. While a comprehensive policy proposal is
beyond the scope of this Article, some of the existing complexities
could be alleviated by enacting legislation to permit local governments
to devise their own procedures for minimum housing standards, and
for all types of regulations governing vacant and abandoned dwellings,
subject to reasonable due process requirements. Freed from the
restrictions imposed by the current minimum housing statutes, local
governments could experiment with policies for the regulation of
dwellings found "unfit for human habitation" and for dwellings in
other conditions, perhaps developing seamless regulations covering
dwellings from green to red. Each governing board could evaluate for
itself the ideal level of regulation required to achieve its goals and to
meet the needs of its citizens, developing a variety of regulatory mechanisms and perhaps inventing new, more efficient, and more effective
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models of regulation. 170 They might adopt mechanisms long used in
other states, such as receivership. 71 The best models would rise to the
top in a market-like competition among localities, as each citizen voted
"with his or her feet" and gravitated toward the jurisdiction providing
the ideal mix of regulation and services based on that resident's specific preferences. 1 72 One drawback to this approach is that it would
further dismantle whatever procedural uniformity now exists statewide. A more limited version of this proposal would involve authorizing pilot programs and then selecting the top few for implementation
statewide. Either way, opening up the regulatory options would
require deliberate action by the General Assembly.
Whether the General Assembly retains the current regulatory
scheme, tinkers with it, or overhauls it, North Carolina local governments will continue to seek means for regulating vacant and abandoned dwellings. Current authority under the general police power
and minimum housing statutes is sufficient for the development of a
comprehensive approach to vacant dwellings such as a vacant property
registration program, but the task is complicated by the tension and
imprecise boundaries between the general police power and the minimum housing statutes. With communities struggling in the midst of
an economic crisis that has caused unprecedented numbers of foreclosures in North Carolina, it may be the right time to revisit the statutory
authority granted to local governments to regulate vacant and abandoned dwellings.
170. Winston-Salem presents a case in point. See Laura Graff, City Wants State Permission to Renovate Rundown Homes, WINSTON-SALEM J., Jan. 13, 2009, http://www2.
journalnow.com/content/2009/j an/13/city-wants-state-permission-to-renovate-rundown-ho ("City officials asked the Forsyth County legislative delegation yesterday to
consider pushing for a bill that would allow the city to take over severely dilapidated
homes and renovate them into homes for low- and moderate-income people."); see also
supra note 25.
171. For a discussion of the merits of receivership, see James J. Kelly, Refreshing the
Heart of the City: Vacant Building Receivership as a Tool for Neighborhood Revitalization
and Community Empowerment, 13 J. AFFORDABLE HOUSING & CMTY. DEv. L. 210 (2004),
available at http://www.vacantproperties.org/resources/ppts/kelly-refreshing.pdf.
172. See generally Charles M. Tiebout, A Pure Theory of Local Expenditures, 64J. POL.
ECONOMY 416 (1956) (suggesting that citizens shop among various localities and then
settle in the one that best suits their preferences).
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